DRDGOLD Limited 20F 2014 Annual report

UNITED STATES SECURITIES 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 1934

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT 1934

For the fiscal year ended June 30, 2014

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)

50 Constantia Boulevard, Constantia Kloof Ext 28, Roodepoort, 1709, South Africa

(Address of principal executive offices)

Anthon Meyer, Acting Chief Financial Officer, Tel. no. +27 11 470 2600, Email anthon.meyer@drdgold.com

Francois Bouwer, Group Financial Accountant, Tel. no. +27 11 470 2600, Email francois.bouwer@drdgold.com

50 Constantia Boulevard, Constantia Kloof Ext 28, Roodepoort, 1709, South Africa

(Name, Telephone, Email and/or Facsimile number and Address of Company Contact Person)

Securities registered or to be registered pursuant to Section 12(b) of the Act

Title of each class:

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.)

The New York Stock Exchange, Inc.

Securities registered or to be registered pursuant to Section 12(g) of the Act

None

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act

None

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.

As of June 30, 2014 the Registrant had outstanding 385,383,767 ordinary shares, of no par value.

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes

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

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any,

every Interactive Date File required to be submitted and posted 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 and post such files). Yes

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer.
Large accelerated filer

Accelerated filer

Non-accelerated filer

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 IASB

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

Contact details: Mr. T.J. Gwebu – Executive Officer: Legal, Compliance and Company Secretary

DRDGOLD Limited, Quadrum Office Park, First Floor, Building 1, 50 Constantia Boulevard, Constantia Kloof Ext. 28, Roodepoort,

1709, South Africa; Telephone: +27 11 470 2600

TABLE OF CONTENTS

Page

PART I

ITEM 1.

IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS ......................................................... 4

ITEM 2.

OFFER STATISTICS AND EXPECTED TIMETABLE ........................................................................................... 4

ITEM 3.

KEY INFORMATION ................................................................................................................................................ 4

3A.

Selected Financial Data ............................................................................................................................................... 4

3B.

Capitalization And Indebtedness ................................................................................................................................. 6

3C.

Reasons For The Offer And Use Of Proceeds ............................................................................................................. 6

3D.

Risk

Factors

.................................................................................................................................................................. 6

ITEM 4.

INFORMATION ON THE COMPANY ..................................................................................................................... 18

4A.

History And Development Of The Company .............................................................................................................. 18

4B.

Business

Overview

......................................................................................................................................................... 20

4C.

Organizational

Structure

................................................................................................................................................ 29

4D.

Property, Plant And Equipment ................................................................................................................................... 29

ITEM 4A.

UNRESOLVED STAFF COMMENTS ....................................................................................................................... 42

ITEM 5.

OPERATING AND FINANCIAL REVIEW AND PROSPECTS .............................................................................. 43

5A.

Operating Results ........................................................................................................................................................ 44

5B.

Liquidity

And

Capital

Resources

................................................................................................................................... 63

5C.

Research And Development, Patents And Licenses, Etc ............................................................................................. 65

5D.

Trend

Information

.......................................................................................................................................................... 65

5E.

Off-Balance Sheet Arrangements ..................................................................................................................................65

5F.

Tabular Disclosure Of Contractual Obligations ............................................................................................................66

5G.

Safe

Harbor ................................................................................................................................................................... 66

ITEM 6.

DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES ................................................................................66

6A.

Directors And Senior Management ...............................................................................................................................66

6B.

Compensation ............................................................................................................................................................... 68

6C.

Board

Practices

............................................................................................................................................................... 70

6D.

Employees

..................................................................................................................................................................... 75

6E.

Share Ownership

............................................................................................................................................................ 77

ITEM 7.

MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS ............................................................... 79

7A.

Major

Shareholders

......................................................................................................................................................... 79

7B.

Party

Transactions

.............................................................................................................................................. 80

7C.

Interests Of Experts And Counsel ................................................................................................................................ 81

ITEM 8.

FINANCIAL INFORMATION .................................................................................................................................... 82

8A.

Consolidated statements And Other Financial Information ......................................................................................... 82

8B.

Significant

Changes

........................................................................................................................................................ 82

ITEM 9.

THE OFFER AND LISTING ....................................................................................................................................... 82

9A.

Offer And Listing Details ............................................................................................................................................. 82

9B.

Plan

Distribution

........................................................................................................................................................ 84

9C.

Markets

.......................................................................................................................................................................... 84

9D.

Selling

Shareholders

....................................................................................................................................................... 84

9E.

Dilution..........................................................................................................................................................................84

9F.

Expenses Of The Issue ................................................................................................................................................. 84

ITEM 10.

ADDITIONAL INFORMATION ................................................................................................................................. 84

10A.

Capital

.................................................................................................................................................................. 84

10B.

Memorandum of Incorporation .................................................................................................................................... 84

10C.

Material

Contracts

.......................................................................................................................................................... 87

10D.

Exchange

Controls

......................................................................................................................................................... 88

10E.

Taxation

........................................................................................................................................................................ 90

10F.

Dividends And Paying Agents .....................................................................................................................................94

10G.

Statement By Experts .................................................................................................................................................. 94

10H.

Documents

Display

.................................................................................................................................................. 94

10I.

Subsidiary

Information

.................................................................................................................................................. 94

ITEM 11.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK ............................................ 95

ITEM 12.

DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES .......................................................... 96

12A.

Debt Securities ............................................................................................................................................................ 96

12B.

Warrants and Rights .................................................................................................................................................... 96

12C.

Other Securities .......................................................................................................................................................... .96

12D

American Depositary Shares ....................................................................................................................................... 96

TABLE OF CONTENTS

PART II

ITEM 13.

DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES ...................................................................... 97

ITEM 14.

MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS ....... 97

ITEM 15.

CONTROLS AND PROCEDURES ............................................................................................................................ 97

ITEM 16A.

AUDIT COMMITTEE FINANCIAL EXPERT .......................................................................................................... 98

ITEM 16B.

CODE OF ETHICS ...................................................................................................................................................... 98

ITEM 16C.

PRINCIPAL ACCOUNTANT FEES AND SERVICES ............................................................................................. 98

ITEM 16D.

EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES ............................................ 99

ITEM 16E.

PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS ...................... 99

ITEM 16F

CHANGE IN REGISTRANT'S CERTIFYING ACCOUNTANT ............................................................................. 99

ITEM 16G.

CORPORATE GOVERNANCE .................................................................................................................................. 99

ITEM 16H.

MINE SAFETY DISCLOSURES ................................................................................................................................ 100

PART III

ITEM 17.

FINANCIAL STATEMENTS ...................................................................................................................................... 100

ITEM 18.

FINANCIAL STATEMENTS .......................................................................................................................................

ITEM 19.

EXHIBITS ..................................................................................................................................................................... 101

Preparation of Financial Information

We are a South African company and currently all of our operations, as measured in production ounces, are located there.

Accordingly, our books of account are maintained in South African Rand. Our financial statements included in our corporate filings
in South Africa were prepared in accordance with International Financial Reporting Standards (IFRS), as issued by the
International Accounting Standards Board (IASB) for the financial years ended June 30, 2014, 2013 and 2012. All references to
“dollars” or “$” herein are to United States Dollars and references to “rand” or “R” are to South African Rands.

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 stated in accordance with IFRS as issued by the IASB.

We present our financial information in rand, which is our presentation currency. 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 11.3055 per $1.00, which was the noon buying rate in New
York City on September 30, 2014.

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 and “capital expenditure (cash)”, 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 cash and cash equivalents, operating costs, profit/(loss)
attributable to equity owners of the parent, profit/(loss) before taxation 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 definitions for the calculation of cash operating costs, the calculation of cash operating costs per kilogram, all-in
sustaining costs 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 per kilogram-
Reconciliation of cash operating costs per kilogram, all-in sustaining costs per kilogram, all-in costs per kilogram and capital
expenditure (cash).”

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.

Special Note Regarding Forward-Looking Statements

This Annual Report contains certain “forward-looking” statements within the meaning of Section 21E of the Exchange Act,

regarding future events or other future 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. These statements also include descriptions in connection with, among other things:

· 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 commitments;
· our ability to fund our operations in the next 12 months; and
· estimated production costs, cash operating costs per ounce, all-in sustaining costs per ounce and all-in costs per ounce.

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 business strategy;
· 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; or
· adverse changes in foreign exchange rates and various other 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 these 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.

Readers 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.

Imperial units of measure and metric equivalents

Units stated in this Annual Report are measured in Imperial and Metric.

Metric

Imperial

Metric

1 metric tonne

1.10229 short tons

1 short ton

0.9072 metric tonnes

1 kilogram

2.20458 pounds

1 pound

0.4536 kilograms

1 gram

0.03215 troy ounces

1 troy ounce

31.10353 grams

1 kilometer

0.62150 miles

1 mile

1.609 kilometres

1 meter

3.28084 feet

1 foot

0.3048 metres

1 liter

0.26420 gallons

1 gallon

3.785 liters

1 hectare

2.47097 acres

1 acre

0.4047 hectares

1 centimeter

0.39370 inches

1 inch

2.54 centimetres

1 gram/tonne

0.0292 ounces/ton

1 ounce/ton

34.28 grams/tonnes

0 degree Celsius

32 degrees Fahrenheit

0 degrees Fahrenheit

- 18 degrees Celsius

Glossary of Terms and Explanations

All-in sustaining costs per
kilogram ..................................

All-in sustaining costs is a measure on which guidance were provided by the World Gold Council
and include cash operating costs of production plus, on-site general and administrative costs,
royalties and production taxes, sustaining capital, sustaining exploration, the accretion of
rehabilitation costs, but excludes depreciation, retrenchment costs, finance costs, depletion and
amortization, reclamation and closure costs. All-in sustaining costs per kilogram are calculated by
dividing 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 were provided by the World Gold Council and include

total operating costs, plus all-in sustaining costs, non-sustaining capital costs relating to projects,
retrenchment costs, capital recoupment relating to non-sustaining capital, ongoing rehabilitation
expenditure, and non-operating costs, but exclude taxation, minority interest, finance costs, profit or
loss from associates and the cumulative effect of accounting adjustments. All-in costs per kilogram
are calculated by dividing 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.
Care and maintenance ............Cease active mining activity at a shaft, but continue to incur costs to ensure that the Ore Reserves are

open, serviceable and legally compliant.

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. Cash
operating costs per kilogram have been calculated on a consistent basis for all periods presented. 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.

Conglomerate .........................A coarse-grained sedimentary rock consisting of rounded or sub-rounded pebbles.
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.

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.

Dilution ................................ Broken rock entering the ore flow at zero or minimal grade and therefore diluting the gold content per

ton.

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 ton of ore.

g/t ......................................... Grams per ton.
Horizon ................................ A plane indicating a particular position in a stratigraphic sequence. This may be a theoretical surface

with no thickness or a distinctive bed.

Life of mine ........................... Projected life of a mining operation based on the Proven and Probable Ore Reserves.
Metallurgical plant ................ A processing plant (mill) erected to treat ore and extract the contained gold.
Mine call factor ..................... This is the gold content recovered expressed as a percentage of the gold content called.
Mt .......................................... Million tons.
Opening up ............................ The potential that previously abandoned shafts and mining or developed areas, have to be reopened

and mined.

Ore ........................................ A mixture of valuable and worthless materials from which the extraction of at least one mineral is

technically and economically viable.

Ore Reserves ....................... Attributable total ore reserves of subsidiaries.
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.

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.
Reef ...................................... A gold-bearing sedimentary horizon, normally a conglomerate band that may contain economic levels

of gold.

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.

Sedimentary ......................... Formed by the deposition of solid fragmental material that originated from weathering of rocks and

was transported from a source to a site of deposition.

Shaft ..................................... An opening cut downwards for transporting personnel, equipment, supplies, ore and waste. A shaft is

also used for ventilation and as an auxiliary exit. It is equipped with a hoist system that lowers and
raises a cage in the shaft, transporting equipment, personnel, materials, ore and waste. A shaft
generally has more than one compartment.

Slimes .................................. The fraction of tailings discharged from a processing plant after the valuable minerals have been

recovered.

Sloughing ............................. The localized failure of part of the slimes dam wall caused by a buildup of water within the dam.
Stope .................................... Underground production working area on the Ore Horizon.
Stoping ................................. The removal of the wanted ore from an underground mine leaving behind an open space known as a

stope. Stoping is used when the country rock is sufficiently strong not to cave into the stope, although
in most cases artificial support is also provided.

t’000 ..................................... Tons 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.
Waste rock ............................ Non-auriferous rock.
Yield ..................................... The amount of recovered gold from production generally expressed in ounces or grams per tonne of

ore.

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, 2014, 2013 and 2012 and for the years ended June 30,

2014, 2013 and 2012 are derived from our consolidated financial statements set forth elsewhere in this Annual Report, which have
been prepared in accordance with 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, 2011 and 2010, and for the years ended June 30, 2011 and 2010 is
derived from audited consolidated financial statements not appearing in this Annual Report which have been prepared in accordance
with IFRS as issued by the IASB and restated for new accounting policies adopted. 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.

Selected Consolidated Financial Data

(in thousands, except share, per share and ounce data)

Year ended June 30,

2014

2013²

Restated

2012²

Restated

2011²

Restated

2010²

$’000

R’000

Profit or loss Data

Revenue .............................................................

160,049

1,809,434

2,076,496

3,004,264

2,565,319

1,990,522

Results from operating activities ......................

(1,110)

(12,547)

184,704

367,712

(413,971)

35,485

Results from operating activities from

continuing operations ....................................

(1,110)

(12,547)

184,704

240,151

112,634

61,270

(Loss)/profit for the year attributable to

equity owners of the parent ...........................

(4,052)

(45,808)

49,420

294,313

(287,915)

207,815

(Loss)/profit for the year attributable to

equity owners of the parent from
continuing operations ....................................

(4,052)

(45,808)

49,420

202,939

67,070

186,553

Per Share Data

Basic (loss)/earnings per share (cents) ............

(1)

(12)

(75)

Basic (loss)/earnings per share - continuing

operations (cents) ..........................................

(1)

(12)

Diluted (loss)/earnings per share (cents) .........

(1)

(12)

(75)

Diluted (loss)/earnings per share -

continuing operations (cents) .......................

(1)

(12)

Dividends proposed per share (ZAR cents) ....

28.0

10.0

7.5

5.0

Dividends proposed per ADS (USD cents) .....

1.6

28.2

12.1

9.5

7.3

Average exchange rate (USD1:ZAR)

............

10.42

8.92

7.77

6.95

7.56

Number of shares issued as at June 30 ............ 385,383,767

385,383,767

384,884,379

Statement of financial position data

Total assets ........................................................

215,890

2,440,746

2,669,000

2,489,006

2,288,661

2,580,292

Equity (Net assets) ............................................

131,017

1,481,211

1,643,672

1,631,763

1,219,166

1,649,961

Ordinary share capital .......................................

361,636³

4,088,474³

4,089,287³

4,089,117³

4,132,604

4,133,318

Month

2014

September

August

July

June

May

April

Exchange Rate Data

Average (USD1:ZAR) .......................................

10.98

10.65

10.66

10.67

10.37

10.51

High (USD1:ZAR) .............................................

11.35

10.83

10.84

10.86

10.59

10.68

Low (USD1:ZAR) .............................................

10.60

10.52

10.46

10.53

10.22

10.31

Translations into Dollars in this table are for convenience only and are computed at the noon buying rate in New York City at September 30,

2014 of R 11.3055 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 document are based on exchanges rates quoted by local financial service providers.
² Comparatives have been restated for the reclassification of Blyvooruitzicht Gold Mining Company Limited (Blyvoor) as a discontinued
operation (disposed June 1, 2012) and the adoption of newly effective accounting policies where relevant.
³ Ordinary share capital is stated after the deduction of R44.2 million (2013: R44.4 million and 2012: R44.8 million) share capital relating to
treasury shares held within the Group.

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 the most relevant 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, or 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.

As the majority of our production costs are in Rands, while gold is generally sold in dollars, our results of operation and

financial condition have been and could be materially harmed in the future by an appreciation in the value of the rand. 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, for example, incurring retrenchment costs earlier than expected. Accordingly, any sustained
decline in the price of gold would negatively and adversely affect our business, operating results and financial condition.

We 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 our gold and trade 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 of 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. In fiscal 2014, 2013,and 2012 the rand weakened against the

dollar by 7.2%, 19.3% and 21.1% respectively (based on exchange rates at June 30 of each year). From December 2001, when the
exchange rate reached R13.44 = $1.00, the rand has appreciated by 21.3%. against the dollar to R10.58= $1.00 at June 30, 2014
(based on closing rates). At September 30, 2014 the rand traded at R 11.28 = $1.00 (based on closing rates), a 6.6% weakening
relative to the Dollar from June 30, 2014.

A decrease in the dollar gold price and a strengthening of the foreign exchange rate of the rand against the dollar could result

in a decrease in our profitability. In fiscal 2014, 2013 and 2012 all of our production was from South Africa providing significant
exposure to the strengthening of the rand and a decrease in profitability. If the rand were to appreciate against the dollar for a
continued time, our operations could experience a reduction in cash flow and profitability and this would adversely affect our
business, operating results and financial condition.

Inflation may have a material adverse effect on our results of operations.

South Africa has experienced high rates of inflation in the past. Higher inflation in South Africa may result in an increase in

our future 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. Significantly 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.

We have incurred losses in the past and may incur losses in the future.

We incurred a net loss of R54.7 million for fiscal 2014 and achieved a net profit of R97.7 million for fiscal 2013 and a net

profit of R374.8 million for fiscal 2012.

The loss in fiscal 2014 was largely due to a 5.5% drop in the average rand gold price received amounting to R432,775 per

kilogram and a decline of 9.2 % in gold produced from continuing operations. It also includes an impairment of R56.6 million
relating to R12.4 million against property, plant and equipment and R46.9 million against available-for-sale financial assets which
was offset by a reversal of an impairment of R2.7 million on equity accounted investments.

The profit in fiscal 2013 was largely due to a 9% increase in the average rand gold price received amounting to R458,084

per kilogram and an 8% increase in gold produced from continuing operations, which was partly offset by an impairment of R187.9
million relating to R61.0 million against property, plant and equipment, R101.3 million against available-for-sale financial assets and
R25.6 million against investments. It also included a share of losses of equity accounted investment of R50.1 million relating
impairments of exploration assets recognized at Chizim Gold level.

The profit in fiscal 2012 was largely due to a 36% increase in the average rand gold price received amounting to R418,538

per kilogram.

Our profits and cash flows of our operations are directly exposed to the gold price, strength of the rand and higher input

costs as we do not hedge.

We may not be able to meet our cash requirements because of a number of factors, many of which are beyond our

control and cannot guarantee that alternative financing would be available.

Management’s estimates on future cash flows are subject to risks and uncertainties, such as the 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 alternative financing and we cannot guarantee that any such financing would be
permitted under the terms of our existing financing arrangements, or would be available on acceptable terms, or at all. In the absence
of sufficient cash flows or adequate 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 increased
working capital requirements may be adversely affected.

The failure to discover or acquire new Ore Reserves could negatively affect our cash flow, results of operations and

financial condition.

Our future cash flow, results of operations and financial condition are directly related to the success of our exploration

and acquisition efforts in South Africa and any new regions that we identify for future growth opportunities. Our Ore Reserves for
fiscal 2014 decreased by 10.0% due to ongoing mining activities, in 2013 it decreased by 8%, also in main due to depletion from
mining activities. Our Ore Reserves for fiscal 2012 decreased by 75%, mainly due to the disposal of Blyvoor which represented
73% of our Ore Reserves on June 30, 2011.

Any new or ongoing exploration programs may not result in new mineral producing operations that will sustain or

increase our Ore Reserves. A failure to discover or acquire new Ore Reserves in sufficient quantities to maintain or grow the
current level 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 influence on the future viability of our operations.

We may need to improve our internal controls over financial reporting and our independent auditors may not be able to

attest to their effectiveness because of inherent limitations.

We have evaluated our internal controls over financial reporting for the current fiscal period so that management can attest

to the effectiveness of these controls, as required by Section 404 of the United States Sarbanes-Oxley Act of 2002. Management has
determined that these controls were effective for the 2014, 2013 and 2012 fiscal years respectively and did not identify any material
weaknesses within our internal controls surrounding the financial reporting process. These internal controls over financial reporting
may not be sufficient to prevent significant deficiencies or material weaknesses in the future, and we may also identify other
conditions that could result in significant deficiencies or material weaknesses. In this event, we could experience a negative reaction
in the financial markets and incur additional costs in improving the condition of our internal controls. For a detailed discussion of
controls and procedures, see Item 15: “Controls and Procedures.”

Single point of failure due to one operating segment

With the disposal of Blyvoor on June 1, 2012, we currently have only one operating segment, namely Ergo. The various

processing plants, pump stations and deposition site of this business are linked through pipeline infrastructure. The Ergo plant is now
our major processing plant and we have one deposition site. The pipeline infrastructure relating to the Ergo plant and Brakpan
Tailings Storage Facility ("Brakpan TSF") are exposed to numerous risks, including operational down time due to unplanned
maintenance, destruction of infrastructure, spillages, higher than expected operating costs, or lower than expected production each of
which could have a material adverse effect on our business, operating results and financial condition.

Increased production costs could have an adverse effect on our results of operations.

Our historical production costs have increased significantly and we may not be able to accurately predict and adequately

provide for further increases in our production costs. Production costs are affected by, among other things:

· labor stability, lack of productivity and increases in labor costs;
· increases in electricity and water prices;
· increases in crude oil and steel prices;
· unforeseen changes in ore grades and recoveries;
· unexpected changes in the quality or quantity of reserves;
· technical production issues;
· environmental and industrial accidents;
· gold theft;
· environmental factors; and
· pollution.

The majority of our production costs consist of reagents, labor, steel, electricity, water, fuels, lubricants and other

oil and petroleum based products. The production costs incurred at our operations have in the past, and could in the future, increase at
rates in excess of our annual expected inflation rate and result in the restructuring of these operations at substantial cost. The majority
of our South African labor force is unionized and their wage increase demands are usually above the then prevailing rates of inflation.
Ergo and ERPM signed a two year wage settlement agreement with effect from July 1, 2013, with the National Union of
Mineworkers of South Africa, or NUMSA and United Association of South Africa, or UASA, on October 9, 2013, which provides
for average annual compensation increases in year one of 10% for categories 4 – 5, 9% for categories 6 – 7 and 8% for categories
8 – 15; and in year two 8% for categories 4 – 5 and 7.5% for categories 6 – 15. On September 4, 2014, Ergo and ERPM extended
the two year wage settlement agreement with effect from July 1, 2015 to June 30, 2016, with NUMSA and UASA, which provides
for average annual compensation increases in year one of 10% for categories 4 – 5, 9% for categories 6 – 7 and 8% for categories
8 – 15.

In addition, in the past, we have been impacted by large price increases imposed by our South African steel suppliers and

parastatal entities which supply us with electricity and water. Increases in steel, electricity or water prices combined with the
increases in labor costs, could result in our costs of production increasing above the gold price received. Discussions with steel
suppliers and parastatal entities to moderate price increases have been unsuccessful in the past. A wage strike by NUMSA during
July 2014 caused a delay in the delivery of certain steel products to our operations.

The emergence of a new labor union, the Association of Mineworkers and Construction Union, or AMCU and labor unrest

driven by them in South Africa during 2013 and 2014 in the gold and platinum industry have resulted in extended strikes. In certain
instances wage settlements that were reached with other representative labor unions were challenged by AMCU and increased
uncertainty in the labor market resulted. As at September 30, 2014 AMCU had no representation at any of our operations nor have
there been demands for recognition. We cannot guarantee that no such demands will be made in the future.

The costs of fuels, lubricants and other oil and petroleum based products have increased in fiscal 2014 as a result of the

weakening of the exchange rate with the cost of crude oil in global markets remaining relatively flat to slightly lower. In the event
that crude oil prices increase, this could have a significant impact on our production costs.

Our initiatives 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 sufficient to offset the increases affecting our operations and could
adversely affect our business, operating results and financial condition.

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 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 these environmental laws and regulations. We have
estimated our aggregate group Rehabilitation, Reclamation and Closure cost provision at R471.7 million which is included in our
statement of financial position as at June 30, 2014 (Consisting of provision for environmental rehabilitation: R451.2 million and
liabilities held-for-sale R20.5 million). 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 the 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.

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 from our discontinued and now abandoned underground mining areas

could potentially rise and come into contact with naturally occurring underground water or decant into surrounding underground
mining areas and could ultimately also rise to surface. Progressive flooding of these abandoned underground mining areas and
surrounding underground mining areas could 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 in the event that underground water rises

to the surface, we may face, together with all other mining companies in those areas, claims relating to environmental damage as a
result of pollution of ground water, streams and wetlands. These claims may have a material adverse effect on our business, operating
results and financial condition.

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 or breach

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, any of which could force us to stop or limit operations. In addition, the dams could overflow 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.

The business of gold mining is exposed to numerous risks and events, the occurrence of which may result in the death of, or

personal injury, to employees. Regrettably one person died in a work-related incident during fiscal 2012. The employee died after he
lit a fire in a closed shelter while on duty. 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. These incidents could lead to mine operations being halted and
that will increase our unit production costs, due to loss of production. This 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 insure, including those in respect of past mining activities. Our existing property, business interruption and other
insurance contains certain exclusions and limitations on coverage. We have insured property, including loss of profits due to business
interruption in the amount of approximately R6.4 billion. Claims for each and every event are limited by the insurers to R500 million.
Business interruption is only covered from the time the loss actually occurs and is subject to time and amount deductibles that vary
between categories.

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.

Our flotation and fine-grind (FFG) project faces the risk of a start-up project.

Our flotation and fine-grind project 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. This project was commissioned during the second and third quarters of fiscal 2014 and came into full operation in
the third quarter.

Production was temporarily suspended on 2 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
FY2014. The main causes for the unsatisfactory recoveries included carbon management in the Low Grade Section, thickener
availability and management of the water balance. Apart from rectifying the main causes, the operational team also implemented a
twin streaming process by isolating the Crown and City material from the main Elsburg material. By implementing this change the
gold content in the individual feed supply streams can be measured before the product goes into the leach tanks. By comparing these
assays with the final recoveries, management will be able to identify and correct, much earlier, any possible negative impacts whilst it
will also improve the allocation of gold from different sources. A number of smaller engineering upgrades are also being made during
this “time-out” period.

In late August 2014 the FFG was restarted and currently treats one third of the Ergo plant throughput. Once the FFG shows steady,
acceptable recoveries, the remainder of the Ergo plant throughput will also be treated through the FFG. Provided that these required
levels are achieved, we plan to put the full Ergo throughput through the FFG by the end of the 1st quarter of calendar 2015.

The flotation and fine-grind project remains exposed to numerous risks associated with similar start-up 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.

Conditions precedent for completion of the Blyvoor sale were not met before the due date.

The sale agreement entered into in connection with the disposal of Blyvoor consists of two parts, being Part A and Part B.

See Item 5A.: “Operating Results - Recent developments” for a more detailed discussion. The conditions precedent for Part A were
satisfied and Part A was completed on June 1, 2012. However, the Part B conditions for the mining right conversion did not occur
prior to the deadline. On July 30, 2013, Village Main Reef Limited ("Village") suspended financial assistance to Blyvoor and on
August 6, 2013, Blyvoor was placed into provisional liquidation. A legal dispute has now ensued to test whether the conditions for
Part B were not met because of a breach of the agreement on the part of Village Main Reef Limited. Pending the outcome of the
above (which will confirm the ownership of the shares), the 20,000,000 ordinary shares in Village remained in escrow.

Risks related to the gold mining industry

A change in the 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:

· 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.

Our profitability may be negatively impacted by a decline in the gold price and we incur losses when revenue from gold

sales drops below the cost of production for an extended period.

Current economic conditions may adversely affect the profitability of the Group’s operations.

The future outlook for the global economy remains uncertain. Growth generally is still low and the demand for resources is

down from previous highs. During fiscal 2014 the gold price came off a high of U$1,426 per ounce to a low of U$1,192. The
uncertainty in the outlook of resources generally and of gold in particular resulted in tightened credit markets, reduced liquidity and
extreme volatility in fixed income, credit, currency and equity markets. These conditions may adversely affect the Group’s business.
For example, tightening credit conditions may make it more difficult for the Group to obtain financing on commercially acceptable
terms or make it more likely that one or more of our key suppliers may become insolvent and lead to a supply chain breakdown. In
addition, general economic indicators have still not shown signs of sustained recovery - consumer sentiment remains bearish,
unemployment remains high, economic growth is marginal and corporate earnings are uncertain and volatile. To the extent that the
current economic climate worsens or the economic environment in which the Group operates does not recover, the Group could
experience a material adverse effect on its business, results of operations and financial condition.

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 in order 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.

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 or not the deposit contains economically recoverable
mineralization. Uncertainties as to the metallurgical recovery of any gold discovered may not warrant mining on the basis of
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 close 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 growth prospect, especially in a declining gold price environment.

As a result 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. Our mineral exploration
rights may also not contain commercially exploitable reserves of gold. The costs incurred on unsuccessful exploration activities
are, as a result, not likely to be recovered and therefore likely to be impaired.

There is uncertainty with our 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 price of gold declines, or stabilizes at a price that is lower than recent levels,
or if our production costs, and in particular our labor, water, steel and electricity costs, increase or recovery rates decrease, it may
become uneconomical to recover Ore Reserves 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 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. These factors have and could
result in reductions in our Ore Reserve estimates, which could in turn adversely impact upon 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 may result 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 and 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;
· 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 theft including gold bullion theft.

The occurrence of any of these hazards could delay production, increase production costs and may result in significant legal

claims.

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 of 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 the majority of 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 cause emigration of skilled workers. As
a result, we may have difficulties retaining qualified employees.

Inflation can adversely affect us.

Recently, the South African economy has been growing at a relatively slow rate, inflation and unemployment have been

high by comparison with developed countries, and foreign currency reserves have been low relative to other emerging market
countries. The inflation rate in South Africa is relatively high compared to developed, industrialized countries. As of June 2014, the
Consumer Price Inflation Index, or CPI, stood at 6.6% compared to 5.5% in June 2013 which remained flat at 5.5% from June 2012.
The inflation rate slowed to 5.9% as at September 30, 2014. Continuing high levels of inflation in South Africa for
prolonged periods, without a concurrent devaluation of the rand or increase in the price of gold, could result in an increase in our
costs which could reduce our profitability.

Power stoppages 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. Whilst Eskom did manage to contain the number and severity of
power supply stoppages to the extent of not having a material impact on our production, the country’s current reserve capacity
remains insufficient and the risk of electricity stoppages may continue through 2014. Supply interruptions due to cable theft is also on
the increase and may pose a significant risk to the operations.

The group has installed auxiliary emergency units at its plant to prevent the tripping of thickeners and entered into an

agreement for the supply of temporary power generation equipment and services during fiscal 2014 to drive certain key
installations associated with the disposal of tailings. The lease term will commence during October 2014 for a term of five years at
a fixed monthly payment. The group has the option to acquire the equipment at the termination of the lease. There is no assurance
that the measures will be sufficient to mitigate the risk of power stoppages.

Electricity tariffs increased as follows: from April 1, 2012 an average tariff increase of 16.7%, from April 1, 2013 an

average tariff increase of 8.0% and from April 1, 2014 an average tariff increase of 10.79%. These increases have had an adverse
affect on our production costs and future increases of this nature could have a material adverse effect on our business, operating
results and financial condition.

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.

The primary area of focus in respect of occupational health within our operations is noise induced hearing loss, and

occupational lung diseases (OLD) and tuberculosis (TB). We provide occupational health services to our employees, we provide
training and protective gear and continue to improve preventive occupational hygiene initiatives. The costs associated with providing
such occupational health services could increase significantly.

As a result of the South African Constitutional Court decision permitting individuals employed as miners with occupational

lung diseases to sue their current or former employers for damages outside the statutory compensation scheme, we could be subject to
claims against us from previous or current employees, including a potential class action or similar group claim. In January 2013,
DRDGOLD, ERPM and 23 other mining companies were served with a court application for a class action issued in the South
Gauteng High Court by alleged former mineworkers and dependents of deceased mineworkers. In the pending application, the
applicants allege that DRDGOLD, ERPM and other mining companies conducted underground mining operations in such a negligent
manner that resulted in the former mineworkers contracting silicosis and other related diseases. We will assess all such claims, if and
when filed, on their merits. Liability associated with such claims and expenses of dealing with them could have a material adverse
effect on our business, operating results and financial condition.

Increased 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 the

increased 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.

Possible scarcity of water may negatively affect our operations.

National studies conducted by the Water Research Commission, released during September 2009, found that water resources

were 4% lower than estimated in 1995 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.

We entered into a R22 million capital investment programme with the local municipality to source treated sewage water for

our water circuit. This water will be 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. In addition, as part of the Heads of agreement signed between
EMO, Ergo, ERPM and Trans-Caledon Tunnel Authority (TCTA) in December 2012, Ergo has the right to purchase up to 30 Ml of
treated water per day from TCTA at cost price for use in its production circuits. There is no assurance that the measures will be
sufficient to alleviate all the water scarcity issues.

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.

New order rights obtained under the Mineral and Petroleum Resources Development Act, 2002 may not be equivalent to

our old mining rights.

On May 1, 2004, the new Minerals and Petroleum Resources Development Act, or the MPRD Act, came into effect, which

places all mineral and petroleum resources under the custodianship of the state. Private title and ownership in minerals, or the “old
order rights,” are to be converted to “new order rights,” essentially the right to mine.

New order rights obtained under the MPRD Act, are not equivalent to our existing property rights. The area covered by the

new order rights may be reduced by the Department of Mineral Resources, or DMR, if it finds that the prospecting or mining work
program submitted by an applicant does not substantiate the need to retain the area covered by the old order rights. The duration of
the new order rights will no longer be perpetual but rather, in the case of new order mining rights, for a maximum of 30 years with
renewals of up to 30 years each and, in the case of prospecting rights, up to five years with one renewal of up to three years.

The new order rights will only be transferable subject to the approval of the Minister of Mineral Resources. Mining or

prospecting must commence within one year or 120 days, respectively, of the mining right or prospecting right becoming effective,
and must be conducted continuously and actively thereafter. The new rights can be suspended or cancelled by the Minister of Mineral
Resources in the event of a breach or, in the case of mining rights, non-optimal mining in accordance with the mining work program.
The MPRD Act states that the conversions must be granted by the minister if all requirements are completed but it does not stipulate
any time frame. The MPRD Act also provides for holders of old order rights to continue to operate under the terms and conditions of
such rights until conversions under the MPRD Act have been completed. See Item 4B. “Business Overview”.

The implementation of the MPRD Act has resulted in significant adjustments to our property ownership structure. We have

lodged applications to convert all of our old order rights, however, to the extent that we are unable to convert some of our old order
rights to new order rights, and that the exclusive rights to minerals we enjoyed under the previous statutory regime are diminished,
this will result in significant adjustments to our property ownership structure, which in turn could have a material adverse effect on
the underlying value of our operations. As at September 30, 2014, all of our old order mining rights have been converted into new
order rights under the terms of the MPRD Act with only 1 new order right awaiting registration at the Mineral and Petroleum Titles

Mining royalties and other taxation reform could have an adverse affect on the business, operating results and financial

condition of our operations.

The Mineral and Petroleum Resources Royalty Act, No.28 of 2008 was enacted on November 21, 2008 and was published

Registration Office of the DMR.

in the South African Government Gazette on November 24, 2008. The Mineral and Petroleum Resources Royalty Act
(Administration), No.29 of 2008, published on November 26, 2008, became effective from March 1, 2010. 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 the MPRD Act fall outside the ambit of this royalty and consequently the Company does not pay any royalty
on any dumps created prior to the MPRD Act. Introduction of further revenue based royalties or any adverse future tax reforms
would have an adverse effect on the business, operating results and financial condition of our operations.

Ring-fencing of unredeemed capital expenditure for South African mining tax purposes could have an adverse affect 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

different mines regarding the deduction of certain capital expenditure and the carry over thereof 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. 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 the business, operating results and financial
condition of our operations.

The implementation of carbon or other climate change related to taxes might have a direct or indirect negative cost

impact on our operations.

Climate change is a global problem that requires both a concentrated international response and national efforts to reduce

greenhouse gas, or GHG, emissions. The United Nations Framework Convention on Climate Change is the main global response to
climate change. The associated Kyoto Protocol is an international agreement that classifies countries by their level of industrialization
and commits certain countries to GHG emission reduction targets. Although South Africa is not one of these countries identified, it
ranked among the top 20 countries measured by absolute carbon dioxide emissions. During the 2009 Copenhagen climate change
negotiations, South Africa voluntarily announced that it would act to reduce domestic GHG emissions by 34% by 2020 and 42% by
2025, subject to the availability of adequate financial, technological and other support. The two main economic policy instruments
available for setting a price on carbon and curbing GHG emissions are carbon taxation and emissions trading schemes. In a
discussion paper on carbon taxation by the National Treasury of the South African Government released in June 2013 different
methods of carbon taxation were discussed. The implementation of these carbon taxes have been postponed. Should these taxes be
implemented, they might have a direct or indirect negative cost impact on our operations which could have an adverse effect on the
business, operating results and financial condition.

Failure to comply with the requirements of the Broad Based Socio-Economic Empowerment Charter could have an

adverse affect on our business, operating results and financial condition of our operations.

The Broad Based Socio-Economic Empowerment Charter for the South African Mining Industry, or Mining Charter

(effective from May 1, 2004), 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 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. However, there are a number of matters that still require clarification and discussions in respect of interpretations of
the requirements are in progress with the DMR. 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 attain an occupancy rate of
one person per room in on-site accommodation.

When considering applications for the conversion of existing rights, the relevant regulator will take a “scorecard”

approach, evaluating the commitments of each company to the different facets of promoting the objectives of the Mining Charter.
Failure on our part to comply with the requirements of the Mining Charter and the “scorecard” could subject us to negative
consequences. There is also no guarantee that any steps we might take to comply with the Mining Charter would ensure that we
could successfully acquire new order mining rights in place of our existing rights. In addition, the terms of such new order rights
may not be as favorable to us as the terms applicable to our existing rights. In addition, we may incur expenses in giving
additional effect to the Mining Charter and the “scorecard”, including costs which we may incur including the risk of losing our
mining rights if we do not comply with the requirements stipulated in facilitating the financing of initiatives towards ownership by
historically disadvantaged persons. Any of the foregoing could have an adverse affect 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 constituted 17% of our production costs for fiscal 2014, 17% for fiscal 2013 and 32% for fiscal 2012. As of

June 30, 2014, we employed and contracted 2,329 people, of whom approximately 80% 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. In addition, we are subject 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 August and September 2012, there have been a number of illegal strikes at several mining companies in South

Africa and events related to these strikes resulted in 45 people being killed. During February to June 2014, the platinum industry had
a wage strike that lasted for five months. Above inflation wage increases and changes to working conditions were agreed to in order
to bring the strike to an end.

Such events at our operations or elsewhere 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 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 or

how it will further relax or abolish exchange control measures in the future. For further information see Item 10D.: “Exchange
Controls.”

Risks related to ownership of our ordinary shares or ADSs

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 these
sales may occur to be substantial, 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.

Dividend tax, which is a 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. Although this may reduce the tax payable by the
Company or our subsidiaries, the withholding tax will reduce the amount of dividends or other distributions 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.

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. In

addition, our cash producing assets are located outside the United States and a major portion of 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;
· 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 actually 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 the purpose of use in South African courts. It is not possible therefore for an
investor to seek to impose criminal liability on us in a South African court arising from a violation of United States federal
securities laws.

ITEM 4. INFORMATION ON THE COMPANY

4A. HISTORY AND DEVELOPMENT OF THE COMPANY

Introduction

DRDGOLD Limited, or DRDGOLD, is a South African gold mining company engaged in surface gold tailings retreatment

including exploration, extraction, processing and smelting. Our main subsidiary is Ergo Mining Operations Proprietary Limited, or
EMO, in which we hold a 74% interest. Our black economic empowerment partners are Khumo Gold SPV Proprietary Limited, or
Khumo Gold and an employee trust (known as the DRDSA Empowerment Trust), which hold 20% and 6% respectively in EMO. On
June 1, 2012, we sold our entire interest and claims against Blyvoor to Business Venture Investment No 1557 Proprietary Limited, a
wholly owned subsidiary of Village Main Reef Limited, or Village.

On July 1, 2012, all the group’s surface operations, including Crown Gold Recoveries Proprietary Limited, or Crown, all

the surface assets and liabilities of East Rand Proprietary Mines Limited, or ERPM, and ErgoGold (formerly called Elsburg Gold
Mining joint venture), were restructured into Ergo Mining Proprietary Limited, or Ergo Mining. As at June 30, 2013, EMO wholly
owned and operated Crown, Ergo Mining, and ERPM. Ergo Mining, Crown, ErgoGold and ERPM’s Cason operation are
collectively referred to as Ergo.

DRDGOLD is also a 49% partner in Chizim Gold (Pvt) Limited, or Chizim Gold, an early-stage gold exploration project on

Zimbabwe’s Greenstone Belt.

We are a public limited liability company, incorporated on February 16, 1895, as Durban Roodepoort Deep Limited, and our

shares were listed on the Johannesburg Stock Exchange ("JSE") in that same year. In 1898, our milling operations commenced with
30 stamp mills and in that year we treated 38,728 tons of ore and produced 22,958 ounces of gold. On December 3, 2004, the
company changed its name from Durban Roodepoort Deep Limited to DRDGOLD Limited. Our operations have focused on South
Africa's West Witwatersrand Basin, which has been a gold producing region for over 100 years.

Our shares and/or related instruments trade on the JSE, New York Stock Exchange, the Marche Libre on the Paris Bourse,

the Brussels Bourse in the form of International Depository Receipts, the Over The Counter, or OTC, market in Berlin and Stuttgart
and the Regulated Unofficial Market on the Frankfurt Stock Exchange.

Our registered office and business address is 1

Floor, Building 1, Quadrum Office Park, 50 Constantia Boulevard,

Constantia Kloof Ext. 28, Roodepoort, 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 (+27 11) 470-2618. We are registered under the South African
Companies Act, 1973 (as amended) under registration number 1895/000926/06. The South African Companies Act, 1973 has been
superseded by the South African Companies Act 71, 2008 which had been promulgated as from May 1, 2011. For our ADSs, the
Bank of New York Mellon, at 101 Barclay Street, New York, NY 10286, United States, has been appointed as agent.

South African operations

Ergo

Ergo Mining was formed in June 2007, primarily to recover and treat – over a period of 12 years – approximately 186

million tonnes (Mt) of surface tailings contained in the Elsburg Tailings Complex for gold. As a second-phase development, in
conjunction with a new pipeline linking Ergo with Crown, the Ergo plant’s second carbon-in-leach (CIL) circuit was refurbished
during September 2011 at an aggregate cost of R 44,8 million to increase capacity from 1.2 million tonnes per month (Mtpm) to
1.8Mtpm. Ergo Mining is licensed to produce uranium and sulphuric acid. A desktop feasibility study to assess the potential of these
by-products from the Ergo resource suggests that it is not financially viable in the current climate. On July 1, 2012, Ergo Mining
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 Mining acquired DRDGOLD's 35% interest in
ErgoGold for R200 million.

Crown was acquired on September 14, 1998, in exchange for 5,925,139 of our ordinary shares. Crown, which is located

within the Witwatersrand Basin, exploits various surface sources, including sand and slime tailings deposited as part of previous
mining operations. On July 1, 2012, Crown sold its mining assets, mining and prospecting rights and certain liabilities to Ergo Mining
in exchange for shares in Ergo Mining as part of the restructuring of our surface operations.

ERPM, which consists of the original underground mine, which is under care and maintenance, the Cason Dump surface

retreatment operation and ERPM Extension 1 and 2 exploration tenements, were acquired on October 10, 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 Mining in exchange for shares in Ergo Mining as part of the restructuring of our surface operations. In line with the group’s
strategy to exit underground mining operations, on July 24, 2014 EMO and ERPM entered into an agreement with ERPM South
Africa Holding Proprietary Limited, the nominee of Australian based Walcot Capital for the disposal of certain of the
underground mining and prospecting rights held by ERPM including the related liabilities subsequent to fiscal 2014. This
agreement is subject to a number of conditions, including that the Purchaser is to secure funding to pay the purchase consideration
within sixty days of the Signature Date, as well as a number of regulatory consents and permission, most notably consent to the
sale by the Minister of Minerals.

Blyvoor (discontinued operation)

We acquired Blyvoor in September 1997, in exchange for 12,693,279 of our ordinary shares. Blyvoor is a predominantly

underground operating mine located within the Witwatersrand Basin, exploiting gently to moderately dipping gold bearing quartz
pebble conglomerates in addition to certain surface sources. In June 2012 we sold our entire interest in Blyvoor to Village.

A dispute is currently pending between DRDGOLD and Village insofar as the completion of this, the Blyvoor sale is

concerned, after Village failed to attend to certain administrative steps associated with the registration of Blyvoor’s New Order
Mining Rights. Blyvoor was also placed under provisional liquidation by the Village controlled Blyvoor board in August 2013 and
has since been under the control of the provisional liquidators that were appointed by the High Court of South Africa.

Zimbabwe exploration

Chizim Gold

Chizim Gold was established in December 2009 as a 50:50 joint venture with Chizim Investments (Pvt) Limited, or Chizim

Investments, to conduct feasibility studies on certain gold exploration tenements in Zimbabwe’s Greenstone Belt extending over an
area of more than 21,000 hectares. On June 7, 2013 DRDGOLD reduced its holding to 49%. On June 30, 2013 the entity stopped
conducting feasibility studies on all exploration tenements in Zimbabwe. This company is currently dormant after DRDGOLD
withdrew support for its activities during 2013. As underground mining is not in line with DRDGOLD’s strategy, we intend to
dispose of our exploration assets in Zimbabwe.

Important Events in Our Development Generally and in the Current Year

Restructuring of the BEE participation

On March 17, 2014 DRDGOLD agreed to acquire (and essentially roll-up) the stake of its black economic empowerment

partners in EMO for a consideration of R191,100,000, to be paid by issuing to them an aggregate 45.5 million ordinary shares in
DRDGOLD. Upon completion of the transaction, Khumo Gold will be issued 35.0 million shares and the DRDSA Empowerment
Trust 10.5 million.

The shareholders of DRDGOLD have voted in favour of the transaction at a special general meeting of shareholders held

at Johannesburg on June 27, 2014. The transaction remains subject to consent by the Minister of Minerals by not later than March
17, 2015.

Khumo Gold and the DRDSA Empowerment Trust agreed to a three-year lock-in from the closing date of the transaction

before they dispose of any of the DRDGOLD shares that are issued to them in terms of this transaction.

Ergo Mining and Ekhuruleni City Council agree terms to access and use treated sewerage water

On May 22, 2014 Ergo Mining entered into an agreement with the Ekhuruleni City Council that allows Ergo to, for a

period of twelve years commencing on June 14, 2014 draw up to 10 mega litres of processed sewerage water from the Ronderbult
Waste Water Treatment Works. Ergo will pay the council a monthly management fee of 68c per kiloliter consumed. The fee
escalates annually at a rate equal to the South African Consumer Price Index.

For 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.”

4B. BUSINESS OVERVIEW

We are a South African gold mining company 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.

Our strategy is to sustainably and through the appropriate deployment of capital and resources optimally exploit this, on-

surface resources and to expand our reach and create growth opportunities through the improvement and development of
innovative technologies.

This strategy involves investment and value creation in respect of all the capital stocks of sustainable development -

human, financial, intellectual and manufactured – to extract gold from extensive surface resources in the safest and most efficient
manner, thus ensuring the sustainability of our social and environmental capital whilst contributing to sustainable societies in and
around our footprint.

In the longer term DRDGOLD will seek to improve gold recovery so that, in future, the absolute minimum amount of

gold is returned to tailings deposition facilities along with the waste material and to growing our reclamation business by:

· the use of technology and continuing research and development to improve reclamation efficiency and effectiveness;
· acquiring additional surface resources on the Witwatersrand and, possibly, other areas;
· using existing expertise and skills to expand into the reclamation of other minerals from waste material.

In line with our focus on surface re-treatment, we disposed of our last operating underground operation, Blyvooruitzicht

Gold Mining Company Limited, or Blyvoor on June 1, 2012. Blyvoor has therefore been classified as a discontinued operation in
fiscal 2012 in the comparative periods in this Annual Report.

In fiscal 2010, the Group broadened its activities to include initial exploration activities on a small scale in Zimbabwe

through a joint venture in which we currently own 49%. The initial feasibility studies in Zimbabwe indicated potential
underground mining assets, which does not fit with our current strategy of surface gold tailings retreatment. We have therefore
decided not to continue with our Zimbabwe exploration activities.

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, comprising the waste material from earlier

underground gold mining activities. This is done by reprocessing sand dumps and slimes dams along the reefs that stretch from east
to west just to the south of Johannesburg’s central business district (CBD). 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 are also the result of the old treatment methods but do not
require milling. 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.

Underground mining

Our underground mining operations, which have now either been sold or closed down, comprised relatively mature assets

and the principal mining method used was the extraction of Ore Reserves from previously mined-out areas, which required a high
degree of opening up, development and retreatment of these Ore Reserves.

Exploration

Exploration activities are focused on the extension of existing ore bodies and identification of new ore bodies both at

existing sites and at undeveloped sites. Once a potential ore body has been discovered, exploration is extended and intensified in
order to enable clearer definition of the ore body 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

A detailed review of the metallurgical plants and processes for each of the mining operations is provided under Item 4D.:

“Property, Plant and Equipment.”

Market

The gold market is relatively liquid compared to other commodity markets, with the price of gold generally 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 (due to the tendency of
gold to retain its value in relative terms against basic goods and in times of inflation and monetary crises).

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.

After several years of strong trending, the average gold spot price decreased by 19.0% from $1,606 per ounce to $1,296

per ounce during the fiscal year 2014 and by 4% from $1,673 per ounce to $1,606 per ounce during the fiscal year 2013. The
average gold price received by us for fiscal 2014 was R432,775 per kilogram which was 5.5% lower than the previous year at
R458,084 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 fiat currency, will again make gold attractive to investors. The drop in gold price has
squeezed out a number of high cost gold producers and caused investment in exploration and strategic capital to tumble. The supply
of gold has shrunk and is likely to shrink even more due to the significantly reduced capital expenditure and development occurring
in the sector. This coupled with the unimpressive state of the global economy and generally weak economic policies, are likely to
provide significant support to the gold price in the long term.

All of our revenue is generated in South Africa. Our total revenue for year ended June 30, 2014 was R1,809.4 million

(2013: R2,076.5 million and 2012: R3,004.3 million).

All gold we produce is sold on our behalf by Rand Refinery Proprietary Limited, or Rand Refinery, in accordance with a

refining agreement entered into in October 2001. 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. Rand Refinery then usually sells the
gold on the same day as delivery, for the London afternoon fixed Dollar price, with the proceeds remitted to us in rand within two
days. In exchange for this service, we pay Rand Refinery a variable refining fee plus fixed marketing, loan and administration fees.
We currently own 11% (fiscal 2013: 11% and fiscal 2012: 4%) of Rand Refinery.

Ore Reserves

The tables below set out the Proven and Probable Ore Reserves of the Group as of June 30, 2014, and 2013, in both

imperial and metric units. Our Ore Reserves comprise of our attributable 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 reserves are planned to be mined out under the life of mine business plans
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 reporting, all 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. Components of the

calculations included in the geological models and input parameters of the reserve estimation procedures, were checked. In
addition, visual inspection of the planning to deliver an individual block to the metallurgical plant, and the recovery, and
deposition of the tailings, took place. A check is also made of the financial input into the costs and revenue to affirm that they are
within reasonable limits.

The Ore Reserves are inclusive of diluting materials and allow for losses that may occur when the material is mined. 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 created using our
mining software;
· The potential ore, which is legally allowed to be mined, is also confined by the mine's lease boundaries; and
· A full life of mine business plan (physical 5 year plan) is prepared to mine the ore from existing infrastructure.

Our Ore Reserves figures are estimates, which may not reflect actual reserves or future production. We have prepared these

figures 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 which may ultimately prove to have been unreliable.

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, reserve estimates
may have to be adjusted and mining plans may have to be altered in a way that might adversely affect our operations. 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 gold prices at the time of reserve determination. In light of the

significant increase in gold prices, since fiscal 2006 the Company prepares its life of mine business plans using the prevailing gold
price at the time of the reserve determination, which is at the end of the fiscal year.

Gold prices and exchange rates used for Ore Reserves and for our business plan are outlined in the following table.

2014

2013

Three-year average

Business Plan

Three-year average

Business Plan

Reserve gold price –$/oz

1,539

1,289

1,559

1,192

Reserve gold price –R/kg

431,098

438,575

390,973

378,158

Exchange rate –R/$

8.71

10.58

7.80

9.87

In fiscal 2014, our attributable Ore Reserves (imperial) decreased by 10.0% from 1.7 million ounces at June 30, 2013, to

1.5 million ounces at June 30, 2014, primarily as a consequence of mining activity (depletion). Based on the life of mine business
plans, the life of mine for our operations at June 30, 2014, are set out below.

Surface

Mine

2014

2013

Ergo .............................................................

8 years

9 years

DRDGOLD's Attributable Ore Reserves as of June 30, 2014 and 2013 are set forth in the tables below.

Ore Reserves: Imperial

At June 30, 2014

At June 30, 2013

Proven Ore Reserves

Probable Ore Reserves

Proven Ore Reserves

Probable Ore Reserves

Tons

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)

Ergo

Surface

................................................................... 109,564

0.01

1,036

39.57

0.01

488

123.296

0.01

1,181

37.69

0.01

495

Total

........................................................................ 109,564

0.01

1,036

39.57

0.01

488

123.296

0.01

1,181

37.69

0.01

495

Ore Reserves: Metric

At June 30, 2014

At June 30, 2013

Proven Ore Reserves

Probable Ore Reserves

Proven Ore Reserves

Probable Ore Reserves

Tonnes

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)

Ergo

Surface

..................................................................

99,397

0.32

32.198

35.898

0.42

15.191

111.854

0.33

36.739

34.192

0.45

15.388

Total

.......................................................................

99,397

0.32

32.198

35.898

0.42

15.191

111.854

0.33

36.739

34.192

0.45

15.388

The Attributable Ore Reserves represent DRDGOLD's 74% attributable Ore Reserves of Ergo from the Elsburg and Benoni tailings complexes which are being processed by Ergo, however the mining rights for

these tailings are owned by ERPM. Crown has been included under Ergo for fiscal 2014 and 2013.

The 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 mill.

The measurement and classification of our Proven and Probable Ore Reserves are sensitive to an extent to the fluctuation of

the gold price. If we had used different gold prices than the three-year average prices at the time of reserve determination, as of June
30, 2014 and 2013 respectively, we would not have had significantly different reserves as of those dates. Using the same
methodology and assumptions as were used to estimate Ore Reserves but with different gold prices, our attributable Ore Reserves as
of June 30, 2014 and 2013 would be as follows:

Year ended June 30, 2014

Three-year

average price

Business Plan

at prevailing

price

10% Below

prevailing

price

10% Above

prevailing

price

Rand gold price per kilogram

431,098

438,575

387,988

474,208

Dollar gold price per ounce

1,539

1,289

1,385

1,693

Attributable ore reserves (million ounces)

1.5

Year ended June 30, 2013

Three-year

average price

Business Plan

at prevailing

price

10% Below

prevailing

price

10% Above

prevailing

price

Rand gold price per kilogram ..........................................

390,973

378,158

340,342

415,974

Dollar gold price per ounce .............................................

1,599

1,192

1,073

1,311

Attributable ore reserves (million ounces) ......................

1.7

The approximate mining recovery factors for the 2014 ore reserves shown in the above table are as follows:

Surface

Mine

Mine Call Factor

(%)

Metallurgical and

recovery factor

(%)

Ergo .............................

100.0

41.8

The approximate mining recovery factors for the 2013 ore reserves shown in the above table are as follows:

Surface

Mine

Mine Call Factor

(%)

Metallurgical and

recovery factor

(%)

Ergo .............................

100.0

46.3

The following table shows the average drill/sample spacing (rounded to the nearest foot), as at June 30, 2014 and 2013, for

each category of Ore Reserves at our mines calculated based on a three year average dollar price of gold.

Mine

Proven

Reserves

Probable

Reserves

Ergo ...........................................................................................................................

328 ft. by 328 ft.

The pay-limit grades based on the three year average dollar price for gold and costs used to determine reserves as of

June 30, 2014, are as follows:

Surface

Mine

Pay-limit grade

(g/t)

Costs used to

determine pay-

limit grade (R/t)

Ergo ..............................................................................

0.30

58.37

The pay-limit grades and costs used to determine reserves as of June 30, 2013, are as follows:

Surface

Mine

Pay-limit grade

(g/t)

Costs used to

determine pay-

limit grade (R/t)

Ergo ..............................................................................

0.30

58.37

We apply the pay-limit approach to the mineralized material database of our business in order to determine the tonnage and

grade available for mining.

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 MPRD Act, 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 MPRD Act, 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.

Old Order Rights - Mining Authorizations

Schedule II of the MPRD Act allows the Minister to grant, on application, appropriate rights over the same mineral on the

same land which is the subject of the old order right. By way of example, holders of unused old order rights had for a period of one
year from the effective date of the MPRD Act the exclusive right to apply for an appropriate right in terms of item 8 of Schedule II.
Once an old order right is lodged for conversion at the Department of Mineral Resources (DMR), it remains in force until it is
converted.

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 MPRD Act. 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 MPRD Act on May 1, 2004. Similar procedures apply
where we hold prospecting rights and a prospecting permit and conduct prospecting operations. Under the MPRD Act, 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. During this period,
we are permitted to continue to operate under the terms and conditions of the old order rights which we hold. As at September 30,
2014, a substantial portion of our old order mining rights have been converted into new order rights under the terms of the MPRD Act
but await registration at the Mineral and Petroleum Titles Registration Office of the DMR.

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 State President. 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. Should the amendment bill to the MPRDA be enacted in its currently proposed form, the latter three amendments
referred to above may have a fundamental impact on the group's estimated environmental provisions.

In June 2014 the Minister of Minerals asked the State President to delay signing the Bill until after its potential impact on

the industry is further investigated.

Mining royalties

Effective March 1, 2010, royalties from mining activities became payable to the state under provisions contained in the

Mineral and Petroleum Resources Royalty Act, or the Royalty Act. The most significant feature of the Royalty Act is that the
royalty is to be determined in accordance with a formula based system and no longer to be a predetermined specific rate for the
different types of minerals. The royalty is deductible for normal income tax purposes.

The Royalty Act defines the tax base as gross sales excluding the transportation and handling costs of the final product.

The final product can be either the “refined” or “unrefined” mineral depending on the nature of the mineral in question. There has
been general consensus that a formula derived mineral royalty rate regime is more equitable and provides the necessary relief for
mines during times of difficulties, e.g. low commodity prices and mines that become marginal due to low grades. The formula-
based mineral royalty rate regime also ensures that the State shares in the benefits of higher commodity prices. The State thus
shares in the downside risks, when mines become marginal, and in the upside benefits during times of high commodity prices.
Based on comments received, the formulae were adjusted to take into account the capital intensive nature of certain mining
operations, especially Gold mining and Oil and Gas. The formulae use earnings before income tax, or EBIT, with 100 percent
capital expensing.

Given that a distinction is drawn between refined and unrefined minerals, the mineral royalty percentage rates (Y%) is

based on the following formulae:

· For refined minerals: Y (%) = 0.5 + [(EBIT divided by (Gross Sales multiplied by 12.5)) multiplied by 100]. This rate is
capped at a maximum of 5.0% with a minimum of 0.5%.

· For unrefined minerals: Y (%) = 0.5 + [(EBIT divided by (Gross Sales multiplied by 9.0)) multiplied by 100]. This rate is
capped at a maximum of 7.0% with a minimum of 0.5%.

For the purpose of calculating the royalty percentage rates a negative EBIT will be set equal to zero.

The Broad Based Socio-Economic Empowerment Charter

In order to promote broad based participation in mining revenue, the MPRD Act provides for a Mining Charter to be

developed by the Minister within six months of commencement of the MPRD Act, 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 in or 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 MPRD Act.

In recognition 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, we have
achieved our commitment to ownership compliance with the MPRD Act 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 20% and 6%, respectively, in our operating subsidiary, EMO. (See Item 4A.: “History and
Development of the Company”).

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 health and 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. The 2009
amendments to the Act dealt with inter alia the 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 a new 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”; a new 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 have also been 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. The President assented to the amendment bill in April 2009. The amendment Act was proclaimed and came into
law in May 2009.

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 dependants 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 2014, we contributed approximately R2.8 million under the COID (2013: R2.2 million) Act 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. Currently the Group is compliant with these payment requirements, which 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 emissions and believe that we are currently in compliance with all local laws and regulations pertaining to
uranium and radon management and that we are within 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 beyond the corporate veil 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 MPRD Act. The MPRD Act 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 MPRD Act imposes specific, ongoing environmental monitoring and financial reporting obligations on the holders of

mining rights.

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

MPRD Act.

The enactment of the amendment bill to the MPRDA in its currently proposed form may have a fundamental impact on the

group's estimated environmental provisions due to the inclusion of historic and old mine dumps in the definition of “residue
stockpiles” which creates certain rehabilitation obligations for the discarded mines to which they pertain as well the extension of the
liability for rehabilitation beyond the issuance of a closure certificate and the requirement to maintain financial provision for closed
sites for a period of 20 years after a site is closed.

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 have funded these environmental rehabilitation costs by making contributions over
the life of the mine to environmental trust funds established for each operation and funds held in insurance instruments. Funds are
irrevocably contributed to trusts 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, 2014, we held a total of R90.9 million (2013:R86.4 million) in trust, the balance held in each fund
being, R82.8 million (2013: R78.6 million) for Ergo, R8.1 million (2013: R7.7 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.

The financial provisions for West Wits and Durban Deep have been consolidated into a single rehabilitation trust. The West

Wits financial provision has been derecognized as at June 30, 2011, 2012, 2013 and 2014 and the Durban Deep financial provision as
at June 30, 2013 and 2014, because it will be transferred along with the rehabilitation liability over the West Wits mining rights
which have been disposed of.

We address shortfalls in the funds by accruing trust investment income for the benefit of the funds by replenishing it with

the proceeds from the sale of redundant mining equipment at the end of the life of the mine and gold from mine cleanup. 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 life of mine, the

MPRD Act assumes a fully compliant fund at any given time in the production life of a mine. The DMR appears to have taken a
practical approach in dealing with this change, and has indicated that the traditional ring fencing of funds may, for investment
purposes be relaxed, and that insurance instruments may also be received subject to the DMR’s consent, to make up the shortfall in
available cash funds. The Company has subsequently made use of approved insurance products for a portion of its rehabilitation
liabilities. As of June 30, 2014, we held a total of R93.7 million (2013: R88.6million) in funds held in insurance instruments. As at
June 30, 2014 guarantees amounting to R305.7 million (2013: R305.7 million) were issued to the DMR. Subsequent to June 30, 2014
an additional guarantee amounting to R98.2 million was issued to the DMR.

The aggregate group rehabilitation, reclamation and closure cost provision was R471.7 million at June 30, 2014, compared

to R524.3 million at June 30, 2013. This has been included in the provision for environmental rehabilitation (R451.2 million) as well
as assets held for sale (R20.5 million) in our financial statements as at June 30, 2014.

4C. ORGANIZATIONAL STRUCTURE

The following chart shows our principal subsidiaries as of September 30, 2014. 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. DRDGOLD holds a
49% ownership interest (50% voting interest) in the Chizim Gold the joint venture in which is incorporated in Zimbabwe.

4D. PROPERTY, PLANT AND EQUIPMENT

DRDGOLD OPERATIONS
SEPTEMBER 30, 2014

Description of Significant Subsidiaries' Properties and Mining Operations

Witwatersrand Basin Geology

Ergo, which consists of the ErgoGold, Crown and ERPM’s Cason operations, is located on surface close to the

Witwatersrand Basin. Crown exploits various surface sources, including sand and slime tailings deposited as part of historical mining
operations. ERPM, halted its underground mining operation in October 2008. Ergo is a surface retreatment operation which is
currently processing slime tailings from the Elsburg tailings facility, which were historically deposited by ERPM’s underground
mining operation.

The Witwatersrand Basin comprises a 4 mile (6 kilometer) vertical thickness of sedimentary rocks situated within the

Kaapvaal Craton, extending laterally for approximately 186 miles (299 kilometers) East-Northeast and 62 miles (100 kilometers)
South-Southeast. The sedimentary rocks generally dip at shallow angles towards the center of the basin, though locally this may vary.
The Witwatersrand Basin is Achaean in age and the sedimentary rocks are considered to be approximately 2.7 to 2.8 billion years old.

Gold mineralization in the Witwatersrand Basin occurs within horizons termed reefs. These occur within seven separate

goldfields located along the eastern, northern and western margins of the basin. These goldfields are known as the Evander Goldfield,
the East Rand Goldfield, the West Rand Goldfield, the Far West Rand Goldfield, the Central Rand Goldfield, the Klerksdorp
Goldfield and the Free State Goldfield. As a result of faulting and other primary controls of mineralization, the goldfields are not
continuous and are characterized by the presence or dominance of different reef units. The reefs are generally less than 6 feet (1.84
meters) thick but, in certain instances, these deposits form stacked clastic wedges which are hundreds of feet thick.

The gold generally occurs in native form within the various reefs, often associated with pyrite and carbon.

Blyvoor, (sold on June 1, 2012), and certain of the underground mining and prospecting rights held by ERPM for which an

agreement to dispose was signed during July 2014 (subject to various suspensive conditions), were predominantly underground
operating mines located within the Witwatersrand Basin, exploiting gold bearing reefs in addition to certain surface sources.

Ergo

Overview

We own 74% of EMO, which in turn owns 100% of Ergo. Ergo is a surface tailings retreatment operation consisting of

the Ergo Mining, Crown, ERPM’s Cason operation and ErgoGold business units which are collectively referred to as Ergo.
ERPM’s Cason Dump surface tailings retreatment operation will be depleted in the fourth quarter of calendar 2014. Ergo
undertakes the retreatment of surface sources deposited as tailing from non-operating mining sites across central and east
Johannesburg. In order to improve synergies, effect cost savings and a simpler group structure, DRDGOLD restructured the group’s
surface operations (Crown, ErgoGold and surface assets of ERPM) into Ergo Mining with effect from July 1, 2012. At June 30, 2014,
Ergo had 2,329 employees, including specialized service providers such as Fraser Alexander Tailings.

Properties

Ergo's operations are 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, 2014 and September 2014, no encumbrances exist on Ergo's property.

Crown is situated on the outskirts of Johannesburg, South Africa and consists of three separate locations, City Deep, Crown

Mines and Knights. The entire mining footprint consists of the mining rights of City Deep, Consolidated Main Reef & Estates, Crown
Mines (“3Cs”) and Crown Gold Recoveries (“CGR”). Crown’s mining rights have been converted to new order rights under the
MPRD Act and the mining rights in respect of the 3Cs were registered at the Mineral and Petroleum Titles Registration Office in
January 2014 . In March 2013, applications for the transfer of the mining rights held by the 3Cs and CGR to ERGO were lodged with
the DMR, following the restructure of the company into a single surface retreatment business unit. These applications were successful
and were notarially executed in March 2014.

The Crown Central operation is located on the West Wits line within the Central Goldfield of the Witwatersrand Basin,

approximately 6 miles (10 kilometers) west of the Johannesburg central business district in the province of Gauteng. Access is via
Xavier Road on the M1 Johannesburg-Kimberley-Bloemfontein highway.

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 Knights operation is located at Stanley and Knights Road Germiston off the R29 Main Reef Road.

History of Ergo
2005

Anglo American Corporation commissioned the Ergo plant in Brakpan in 1977. The operation became part of
AngloGold Ashanti in 1998 and was closed by that company in 2005.

2007

Ergo was founded by EMO (owned by DRDGOLD at the time) and Mintails SA as a joint venture.
On August 6, 2007, the joint venture parties entered into an agreement with AngloGold Ashanti, pursuant to which it
acquired the remaining assets of the Ergo plant for consideration of R42.8 million.
Additional agreements were concluded with AngloGold Ashanti on November 14, 2007 for the acquisition by Ergo of
additional tailings properties and the Withok deposition complex for consideration of R45.0 million.

2008

Ergo Phase 1 was launched comprising the refurbishment and recomissioning of the Ergo plant’s first CIL circuit and
the retreatment of the Elsburg and Benoni tailings complexes.
DRDGOLD acquires Mintails SA’s stake in ErgoGold for R277.0 million.

2009

Ergo Phase 1 commissioning continues; first feeder line to the Ergo Plant from Elsburg tailings complex comes into
operation.
Ergo Phase 2 exploration drilling for gold, uranium and acid completed.

2010

DRDGOLD acquired control of Ergo Mining through the acquisition of Mintails SA’s 50% in Ergo for R82.1 million.
Ergo Phase 1 production ramp-up nears completion with the installation of the second Elsburg tailings complex feeder
line to the Ergo plant. Construction of the Crown/Ergo pipeline commenced.

2011

Construction of the Crown/Ergo pipeline continued and the second CIL circuit of the Ergo plant was refurbished as part
of the Crown/Ergo pipeline project.

2012

The construction of the Crown/Ergo pipeline and second CIL circuit of the Ergo plant was completed.

2013

In order to improve synergies, effect cost savings and a simpler group structure DRDGOLD restructured the group’s
surface operations into Ergo Mining on July 1, 2012, which consisted of Crown, the surface operations of ERPM and
ErgoGold. Construction and commissioning of the Ergo flotation/fine-grind plant was completed in late December
2013.

2014

The FFG was suspended in April 2014 after metallurgical efficiencies declined. Test-work recommenced in August.
A prospecting right in respect of surface tailings dumps on various portions of the Farm Grootvlei and a portion of the
Farm Geduld was registered on May 12, 2014 for a period of 5 years ending on April 21, 2019.

History of Crown (consolidated into Ergo on July 1, 2012)
1979

Rand Mines Limited directors approved the formation of the company Rand Mines Milling and Mining Limited (RM3)
to treat the surface gold tailings created from the underground section of the original Crown Mines, which had been in
operation since the start of gold mining on the Witwatersrand in the late 1800's.

1982

First plant commissioned at Crown Mines to process surface material.

1986

Second plant commissioned at City Deep to process surface material.

1997

Randgold Exploration Limited and Continental Goldfields of Australia entered into a joint venture with the intention to
establish a company that would acquire dump retreatment operations on the Witwatersrand. This resulted in the
formation of Crown Consolidated Gold Recoveries Limited, or CCGR, which was incorporated as a public company in
South Africa in May 1997. Crown was a wholly owned subsidiary of CCGR and consists of the surface retreatment
operations of Crown Central, City Deep and Knights.

1998

We purchased 100% of CCGR.

2002

Khumo Bathong Holdings Proprietary Limited (KBH) purchased 60% of Crown. We were appointed as joint manager of
the operation with KBH.

2005

On July 6, 2005 we signed a Memorandum of Understanding with KBH regarding the acquisition by Khumo Gold of a
15% stake in our then South African operations.
On October 27, 2005, our board of directors approved the transaction with Khumo Gold. The new structure resulted in
Khumo Gold acquiring a 15% interest in a newly created vehicle, EMO, which included 100% of ERPM, Crown and
Blyvoor. As a result we owned an 85% interest in EMO.

2006

On December 11, 2006, Khumo Gold, on behalf of itself and an employee trust, exercised the option granted by us
pursuant to the option agreement concluded between us and Khumo Gold in October 2005 to acquire a further 11% in
EMO. On August 28, 2006, Crown concluded an agreement with AngloGold Ashanti to purchase the Top Star Dump.

2008

The Department of Mineral Resources issued a mining right for gold recovery over the Top Star Dump to Crown.

2009

The reclamation of the Top Star Dump commenced in December 2008. Crown also commenced with the reduction of
volumes to 400,000 tpm to implement the planned Crown Tailings Deposition Facility closure plan.

2010

The surface circuit of ERPM was incorporated into Crown for reporting purposes.
Board approval was obtained to construct a pipeline to the Ergo tailings deposition site to enable Crown to restore its
deposition capacity to 600,000tpm. Restored deposition capacity provides the operation with the opportunity to bring to
account potential new ore reserves.

2011

Construction of the pipeline to the Ergo tailings deposition site continued and was scheduled for completion in
December 2011.

2012

Construction of the pipeline to the Ergo tailings deposition site was completed.

2013

On July 1, 2012, Crown sold its mining assets, mining and prospecting rights and certain liabilities to Ergo Mining in
exchange for shares in Ergo Mining.

Mining and Processing

Ergo undertakes the retreatment of surface sources deposited as tailings from non-operational mining sites from east to

west, just to the south of Johannesburg’s central business district.

Material processed by Ergo is sourced from numerous secondary 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 of time 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 four metallurgical plants, known as Ergo, Crown Mines, City Deep and Knights, have an installed capacity to treat

approximately 25.2 million tons of material per year. All of the plants have undergone various modifications during recent years
resulting in significant changes to the processing circuits. Crown serves as a milling and distribution station, as does City Deep. The
Knights and the Ergo plants are still fully operational.

In addition to the four metallurgical plants, Ergo’s assets include: access to some 750Mt to 900Mt of tailings deposited

across the western, central and eastern Witwatersrand; the Crown milling and pump station close to the Johannesburg central business
district; a 50km pipeline; and tailings deposition facilities including the significant Brakpan TSF.

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. 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.

Set forth below is a description of each of our plants:

Ergo Plant: The expansion of the gold plant by refurbishing the second CIL circuit has increased the capacity to treat an
estimated 21Mt per year. The Ergo flotation/fine-grind ("FFG") plant 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%. This circuit commenced a three month test phase during August 2014 after it was temporarily
suspended in April 2014 following a decline in metallurgical efficiencies and is targeted to be back in full production by
January 2015, if test-work is successful.

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 pumping material to the Ergo Plant for
retreatment.

Crown Mines

Plant: Commissioned in 1982, this surface/underground plant has already been modified and comprises a

circuit including screening, primary cycloning, open circuit milling, thickening, oxygen preconditioning, CIP and CIL,
elution, zinc precipitation followed by calcining and smelting to doré. In June 2012, the gold extraction portion of the Crown
plant was discontinued and all material is now only screened, milled and thickened. This material is then pumped to the
Ergo plant for the final extraction of gold.

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 TSF. Retreatment of the nearby Cason dump is expected to ceased during Q4 of calendar
2014 and retreatment of the Lycaste dump – one of the last remaining sand dumps in this area - commenced. Due to the
location of the Knights plant it is able to access the Brakpan TSF to deposit waste.

ERPM Plant: A small section of the ERPM plant was refurbished and adapted to treat slurry deposits that had accumulated
through run-off in the Angelo pan area. Slurry containing organic material is processed through a scrubber and a variety of
screens to remove the oversize organic material prior to the conventional CIL circuit. This plant treats approximately 10,000
tonnes of material per month.

Electricity to the Ergo plant is supplied from various Eskom supply points for the reclamation units and the tailings

storage facilities. The plant is supplied from the national power grid via a secured source from the Ekurhuleni Council of 11,000
volts. Plant sub stations are stepped down to 6,600 volts before being further reduced to 525 volts for the motor control purposes.
For the Ergo plant the average annual power consumption is about 149 GWHr and the maximum demand is about 32.0MVA.

Electricity is supplied to the Crown Mines and City Deep plants from separate substations referred to as Jupiter and No.

15 Shaft Crown Mines, and for Knights by the Ekhuruleni Town Council. Electricity is supplied directly from the national power
grid to the substation and town council at 44,000 volts. Substations, located on mine sites, transform the power to 6,600 volts for
direct supply to the plants. The power supply is further reduced to 525 volts for smaller devices and equipment. For Crown Mines
and City Deep, the average annual power consumption is about 54 GWHr and 80GWHr, respectively and the maximum demand
are about 15.0MVA and 13.0MVA, respectively. For Knights the average annual power consumption is about 60 GWHr and the
maximum demand is about 14.2MVA.

As of June 30, 2014, the net book value of Ergo’s mining assets was R1,729.5 million (2013: R1,729.5 million).

During fiscal 2014, capital expenditure was mainly directed towards the construction of the Lycaste reclamation station and

the last of the Ergo flotation/fine-grind plant project.

The following capital expenditure was incurred at Ergo in fiscal 2014, 2013 and 2012:

Year ended June 30,

2014

2013

2012

R’000

Benoni sand milling..........................................................................................

3,007

Brakpan tailings dam - Generators...................................................................

968

Computerized X-ray machine...........................................................................

610

Daggafontein Rehabilitation............................................................................

2,253

Reclamation site 4A6.......................................................................................

32,375

Rooikraal Residue line.....................................................................................

Residue linear screens......................................................................................

1,954

Rondebult sewerage water...............................................................................

Security............................................................................................................

1,311

Soweto cluster dump reclamation....................................................................

951

Withok conceptual studies...............................................................................

160

Crown/Ergo Pipeline Project ................................................................................

3,265

33,869

CMR dump ............................................................................................................

Crown 3A2 Slime and steel work upgrade ..........................................................

1,586

Knights residue pipeline .......................................................................................

5,836

13,870

Knights girth gear and pinion ...............................................................................

1,356

1,536

4A11 dump ............................................................................................................

Angelo Pan reclamation ........................................................................................

17,636

2,995

Angelo Pan to Rosherville water pipeline ............................................................

12,805

Vehicles and equipment ........................................................................................

112

Tailings management ............................................................................................

14,196

New water line to Angelo Pan and Rocsherville .................................................

889

35,068

Crown/City Slurry line upgrade ...........................................................................

13,916

Benoni Slurry line .................................................................................................

3,359

8,370

Refurbishment of the Ergo plant and second leach section.................................

983

15,460

Ergo flotation/fine-grind plant ..............................................................................

23,759

254,281

38,510

Ergo flotation/fine-grind plant (pre-production working costs) ..........................

65,813

7,189

Brakpan TSF .........................................................................................................

6,219

11,702

50,733

IT Infrastructure ....................................................................................................

464

1,091

Tower crane ..........................................................................................................

1,910

5,573

Ekurhuleni Business Development Academy (EBDA) training facility .............

189

Cason high grade plant .........................................................................................

20,459

Other ......................................................................................................................

2,500

7,194

154,775

355,843

217,872

Exploration and Development

Exploration and development activity at Ergo involves the drilling of existing surface dumps and evaluating the potential

gold bearing surface material owned by third parties that could be processed on a full treatment basis or purchased outright by Ergo.
Exploration drilling has been done to define the uranium potential of the Elsburg complex. Independent competent person reports
on uranium, sulphur and gold for the Elsburg Proven and Probable Ore Reserves have been compiled.

Environmental and Closure Aspects

Ergo operates at sites located in close proximity to significant municipal infrastructure, commercial and residential

development. The major environmental risks are associated with dust from various recovery 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 the University
of Johannesburg and appropriate community involvement. Environmental management programs, addressing a wide range of
environmental issues, have been prepared by specialist environmental consultants and applied specifically to each dust sample
recovery monitoring site and integrated into Ergo’s internal environmental assessment process. Although Ergo completed a project
for thickening re-processed tailings, there also remains a risk of localized sloughing which can result in that section of the tailings
dam required to be closed temporarily, with repair work being done to the dam wall. 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, such as molasses, are applied. Dust fall-
out is also monitored. 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 has removed a potential
pollution source 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 EIA's, EMP's, Mining Right Conversions, Performance Assessments
and 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. Spatial data is utilised 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 in the future is uncertain, we have estimated that the total

cost for Ergo, in current monetary terms as at June 30, 2014 is approximately R451.2 million. As at June 30, 2014, a total of R82.8
million has been contributed to the Crown Rehabilitation Trust Fund, while a total of R44.6 million has been contributed by Ergo to
funds held in insurance instruments. The Crown 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 and Life of Mine

As at June 30, 2014, our 74% share of the Proven and Probable Ore Reserves of Ergo was 1.5 million ounces. In fiscal 2013

our 74% of the Proven and Probable Ore Reserves was 1.7 million ounces. A Mineral Resource competent person is appointed at
each operation to review our Ore Reserve calculations for accuracy. For Ergo, Mr. Vivian Labuschagne is the appointed Mineral
Resource competent person. The current life of mine business plan is estimated to be eight years.

Production

In fiscal 2014, production decreased to 132,909 ounces from 146,381 ounces in fiscal 2013. This drop was the result of

firstly the late commissioning of the FFG and then as a consequence of significant metallurgical inefficiencies experienced during
initial production coupled with incessant rains over a period of three weeks over this time. We decided to suspend the new circuit
early in April 2014 in order to stabilize the lower grade CIL circuit prior to the commencement of electricity winter tariffs kicking in
in June 2014. Testwork on the FFG commenced in August 2014. Volume throughput for the year was steady at 23,908,000 tonnes
while recovery grades decreased from 0.196g/t to 0.173g/t.

Cash operating costs in fiscal 2014 was up $24 per ounce from $1,094 in fiscal 2013 to $1,118 per ounce.

The following table details our attributable share of the production results from Ergo for the past fiscal year:

2014

2013

Restated

2012

Restated

Production (imperial)
Ore mined ('000 tons) ..................................................................................................

23,908

25,632

23,811

Recovered grade (oz/ton) ............................................................................................

0,005

0.006

Gold produced (ounces)...............................................................................................

132,909

146,381

135,708

Results of Operations
Revenue (R‘000) ...........................................................................................................

1,809,434

2,076,496

1,764,191

Net operating costs (R‘000) .........................................................................................

1,549,417

1,397,177

1,141,973

Cash operating cost (R‘000)

........................................................................................

1,540,622

1,414,904

1,151,400

Cash operating cost per ounce of gold ($)¹ ...................................................................

1,118

1,094

All-in sustaining cost per ounce of gold ($)¹ ................................................................

1,205

1,192

1,275

All-in cost per ounce of gold ($)¹ ..................................................................................

1,309

1,442

1,446

See Item 5A. “Operating Results – Capital expenditure (cash)” for a discussion on capital expenditure.

ERPM

Overview

We effectively own 74% of ERPM, which is consolidated as a subsidiary, through our 74% holding in EMO. ERPM

consists of an underground section and the Cason Dump surface retreatment operation. Underground mining at ERPM was halted in
October 2008 and the financial results and assets and liabilities of these operations are included in ‘Corporate office and other
reconciling items’ in the financial statements for segmental reporting purposes for all three years preserved. The retreatment of Ergo’s
Lycaste Dump will commence as the retreatment of the Cason Dump is completed. These are included under Ergo in the financial
statements for segmental reporting purposes.

At June 30, 2014, ERPM had 71 employees, including specialized service providers.

On July 11, 2014 EMO and ERPM entered into an agreement with ERPM South Africa Holding Proprietary Limited, the

nominee of Australian based Walcot Capital for the disposal of certain of the underground mining and prospecting rights held by
ERPM including the related liabilities during FY2014. This agreement is subject to a number of suspensive conditions including
regulatory consent and permission which had not been fulfilled at the date of this report.

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 Johannesburgon 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. Surface reclamation
operations including the treatment of sand from the Cason Dump, is conducted through the Knights metallurgical plant, tailings
deposition facilities and associated facilities. 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 operates under mining license ML5/1997 in respect of statutory mining and mineral rights. As of June 30, 2014 and
September 2014, no encumbrances exist on ERPM's property.

At June 30, 2014, the net book value of ERPM’s mining assets was Rnil due to the transfer of ERPM’s related surface

mining assets to Ergo as part of the restructuring which took place on July 1, 2012.

History

1895

Formation of East Rand Proprietary Mines Limited.

1991

The FEV shaft was commissioned.

1999

East Rand Proprietary Mines Limited was liquidated in August 1999. The mine was run by a small number of
employees during liquidation. Underground flooding continued during liquidation.

2000

KBH took over control of the mine in January 2000. Operating as Enderbrooke Investments Proprietary Limited, or
Enderbrooke, and employing an outside contractor, the mine re-commenced mining operations in February 2000.

Cash operating cost, cash operating cost per ounce, all-in sustaining cost per ounce and all-in cost per ounce of gold are financial measures of

performance that we use to determine cash generating capacities of the mines and to monitor performance of our mining operations. For a
reconciliation of operating costs see Item 5A.: “Operating Results.”

2002

Crown purchased 100% of ERPM, from Enderbrooke.

2003

An underground fire occurred at FEV Shaft, in February 2003. There was also the loss of Hercules Shaft in June 2003
and the loss of a secondary outlet at the FEV shaft in November 2003.

2004

In July 2004 it was determined that the underground section would undergo a controlled closure program ending March
2005. The closure program was prevented by a reduction in costs and improved productivity at the mine.

2005

Central Shaft placed on care and maintenance. On July 6, 2005, we signed a Memorandum of Understanding with KBH
regarding the acquisition by Khumo Gold of a 15% stake in our South African operations. On October 27, 2005, our
board of directors approved the transaction with Khumo Gold. The new structure resulted in Khumo Gold acquiring a
15% interest in a newly created vehicle, EMO, which includes 100% of ERPM, Crown and Blyvoor. We owned an 85%
interest in EMO.

2006

On December 11, 2006, Khumo Gold, on behalf of itself and an employee trust, exercised the option granted by us
pursuant to the option agreement concluded between us and Khumo Gold in October 2005 to acquire a further 11% in
EMO.
A prospecting right covering an area of 1,252 hectares (3,093 acres) of the neighboring Sallies lease area, referred to as
ERPM Extension 1 was granted by the DMR.

2007

A prospecting right, incorporating the southern section of the old Van Dyk mining lease area and a small portion of
Sallies, was granted by the DMR. Known as ERPM Extension 2, the additional area is 5,500ha (13,590 acres).

2008

On April 25, 2008, ERPM gave notice of intention to restructure the work force due to operational requirements and 239
employees were retrenched during June 2008.
On October 23, 2008, ERPM announced the suspension of drilling and blasting operations underground, following the
cessation of pumping of underground water at the South West Vertical shaft on October 6, 2008 for safety reasons
following the deaths of two employees.
On November 19, 2008, we announced our intention to place on care and maintenance the underground operations of
ERPM, and to proceed with a consultation process in terms of Section 189A of the Labor Relations Act to determine the
future of the mine’s 1,700 employees.

2009

In January 2009, consultations in terms of Section 189A of the Labor Relations Act regarding the future of employees
affected by the placing on care and maintenance of the underground operations were concluded and 1,335 employees
were retrenched.

2010

ERPM’s surface operation, the Cason Dump, was incorporated into Crown for reporting purposes.

2013

On July 1, 2012, ERPM sold all of its surface mining assets (excluding its 50% interest in Ergo) and its 65% interest in
ErgoGold to Ergo Mining in exchange for shares in Ergo Mining.

2014

During July 2014 EMO and ERPM entered into an agreement with ERPM South Africa Holding Proprietary Limited,
the nominee of Australian based Walcot Capital for the disposal of certain of the underground mining and prospecting
rights held by ERPM including the related environmental liabilities. This agreement is subject to a number of suspensive
conditions including regulatory consent and permission which had not been fulfilled at the date of this report.

Mining and Processing

Underground mining operations at ERPM comprised of two vertical shafts known as FEV Shaft and the Central Shaft.

There were also three additional shafts namely the South East Vertical Shaft, or SEV Shaft, used for the transport of employees and
materials and the hoisting of rock, the South West Vertical, or SWV, Shaft and the Hercules Shaft that were used for water pumping
only. The Cason Dump was used for the retreatment of surface material mined from the defunct Cason shaft.

On October 23, 2008, drilling and blasting operations were suspended after the cessation of pumping of underground water

at SWV Shaft on October 6, 2008 for safety reasons following the deaths of two employees at the shaft on September 19, 2008.

On November 19, 2008, we announced our intention to place on care and maintenance the underground operations of

ERPM, and to proceed with a consultation process in terms of Section 189A of the Labor Relations Act to determine the future of
the mine’s 1,700 employees. In January 2009, the consultations were concluded and 1,335 employees were retrenched.

Electricity to ERPM is provided to the Cason Dump, SEV and FEV Shafts from the Bremmer substation, located in close

proximity to the mine in Boksburg. Transmission is at the rate of 88,000 volts. The Simmer Pan substation, located approximately
10 miles (16 kilometers) away from the mine site in Germiston, supplies the SWV and Hercules Shafts. Transmission is at the rate
of 44,000 volts. The two substations, located on mine site, transform the power to 6,600 volts for direct supply to the shaft winder
and air compressors. The power supply is further reduced to 525 volts for smaller devices and equipment used on the mine. The
average annual power consumption has reduced to about 105 GWHr and the maximum demand to about 24 MW. The on-mine
substations are older in nature and undergo annual infrared testing to identify hot connections which are potential fire hazards and
are subject to regular maintenance which includes the inspection of the settings, blades and changing the transformer oil in the
circuit breakers.

Exploration and Development

ERPM has a prospecting right covering an area of 1,252ha (3,094 acres) of the adjacent Sallies mine, referred to as ERPM

Extension 1. The regional geology of the area indicates that there will be a strike change due to faulting associated with an East-West
trending sinistral tear fault. In order to confirm the anticipated change in the geological structure and hence payshoot orientation, it is
envisaged that prospecting will take place through development situated 50m in the footwall. Owing to high induced stress
experienced at depth, there will be concurrent over-stoping (that is stoping taking place concurrently with development) on the reef
plane for safety reasons. Prior to this prospecting right in respect of ERPM Ext. 1 lapsing, an application for a mining right in respect
of the same prospecting footprint was made in terms of the provisions of the MPRDA. The said mining right was approved and
granted and the registration thereof took place in March 2012. The mining right expires in January 2042.

An additional application to extend ERPM’s existing prospecting right eastwards into the Rooikraal/Withok area,

incorporating the southern section of the old Van Dyk mining lease area and a small portion of Sallies, was granted by the DMR in
fiscal 2007. Known as ERPM Extension 2, the additional area is 5,500ha (13,590 acres). This prospecting right was initially granted
for a period of 4 years and expired in March 2011. An application for renewal thereof was made in terms of the provisions of the
MPRDA. The renewal in respect thereof was refused by the DMR in December 2013. An appeal against the refusal of the DMR to
grant the renewal of the prospecting right was lodged with the Legal Services Directorate of the DMR in January 2014. These rights,
ERPM Ext 1 and ERPM Ext 2, both form part of the sale assets of the transaction with Walcot Capital.

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. A program is in place to routinely monitor the rise in water level in the various underground
compartments and there has been a substantial increase in the subsurface water levels.

ERPM’s SWV Shaft was used until October 6, 2008 to manage the rising water level on the Central Witwatersrand Basin.

Some 60 megalitres of water were pumped daily from a depth of approximately 1,000 meters.

On October 6, 2008, pumping of underground water at the South West Vertical Shaft was stopped for safety reasons

following the death of two employees at the shaft on September 19, 2008. Management concluded that the project to upgrade the total
pumping capacity at South West Vertical Shaft with a more efficient system as part of an Eskom-funded demand-side management
project was not economically viable.

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 TSF. 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, and Ergo has the right to purchase up to 30 Ml (million litres) of treated water per day from TCTA at cost price
for use in its production circuits.

While the ultimate amount of rehabilitation costs to be incurred in the future is uncertain, we have estimated that as at June

30, 2014 the present discounted value of the total cost of rehabilitation for ERPM is approximately R20.5 million. A total of R8.1
million has been contributed to the ERPM Rehabilitation Trust Fund and R41.8 million in insurance instruments. This 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 and Life of Mine

Our 74% share of Proven and Probable Ore Reserves of ERPM are included under Ergo. As at June 30, 2014 the total

surface Ore Reserves comprise 0.039 million ounces from the Cason Dump and 1.11 million ounces from the Elsburg and Benoni
tailings complexes, which will be processed over the next one and eight years, respectively. A Mineral Resource competent person is
appointed at each operation to review our Ore Reserve calculations for accuracy. For ERPM, Mr. Vivian Labuschagne is the
appointed Mineral Resource competent person.

Current Production

Although ERPM is under care and maintenance, 257 ounces of gold was produced from clean-up activities during fiscal

2014.

Blyvoor (Discontinued operation)

Overview

Until June 1, 2012, when we sold our entire interest and claims against Blyvoor to Business Venture Investment No 1557

Proprietary Limited, a wholly owned subsidiary of Village, we owned 74% of Blyvoor, which in turn owns 100% of the
Doornfontein Gold Mining Company Limited. The consolidated mining operation, referred to as Blyvoor, consists of the adjacent
mines of Blyvooruitzicht and Doornfontein which are located within the Far West Rand Goldfield on the northwestern edge of the
Witwatersrand Basin. Blyvoor was the first mine in the “West Wits” line. Together, these two operations produced over 38 million
ounces of gold since inception in 1937.

Blyvoor was placed under provisional liquidation by its board of directors, the majority of whom were the nominees of

Village, in August of 2013 following a number of work stoppages due to labor action and seismicity. This mine remains under the
control of the provisional liquidators. The information set our below are based upon information available to us up to the time of our
sale of Blyvoor in June 2012.

Property

Blyvoor is located on the West Wits line within the Far West Rand Goldfield on the northwestern rim of the Witwatersrand

Basin, near the town of Carletonville, Gauteng Province, about 50.0 miles (80.5 kilometers) south-west of Johannesburg and is
reached via the R528 road to Carletonville on the N12 Johannesburg-Potchefstroom-Kimberly highway.

The operating facilities are all situated on property belonging to Blyvoor, and include the shaft complexes, administrative

offices for the managerial, administrative, financial and technical disciplines, extensive workshops and consumable stores, the
metallurgical plants, tailings dams and waste rock dumps. Prior to its liquidation Blyvoor also housed the majority of its employees in
Blyvoor-owned houses on the property and in the town of Carletonville.

Blyvoor consists of one mining license, ML46/99, in respect of statutory mining rights and mineral rights held by Blyvoor.

Blyvoor is in the process of converting these old order mining rights to new order rights under the MPRD Act.

History

1937

Blyvooruitzicht Gold Mining Company Limited was incorporated and registered as a public company in South Africa
on June 10, 1937.

1942

Gold production commenced.

1995

Blyvoor acquired the Doornfontein Gold Mining Company Limited in November 1995.

1996

Blyvoor acquired the mineral rights representing the Western Deep Levels tribute area.

1997

We acquired the entire share capital of Blyvoor on September 15, 1997.

2001

Implementation of the Blyvoor expansion project.

2003

Commissioning of No. 4 and 5 Slimes Dam retreatment facility at a cost of R48.0 million.

2004

On June 28, 2004, we entered into a 60-day review period on Blyvoor. The 60-day review was extended to September 13,
2004. By October 5, 2004, 1,619 employees had been retrenched at a cost of approximately R19.0 million.

2005

In August 2005, our Board of Directors approved No. 2 Sub-Shaft Project (now called the WAP Project) and the Slimes
Dam Project to establish mining operations from the No. 2 Shaft and expansion to further improve plant efficiency,
respectively.
On July 6, 2005, we signed a Memorandum of Understanding with Khumo Bathong Holding Proprietary Limited, or
KBH, regarding the acquisition by Khumo Gold SPV Proprietary Limited, or Khumo Gold, of a 15% stake in our then
South African operations.
On October 27, 2005, our Board of Directors approved the transaction with Khumo Gold. The new structure resulted in
Khumo Gold acquiring a 15% interest in a newly created vehicle, EMO, which owns ERPM, Crown and Blyvoor. We
owned an 85% interest in EMO.

2006

2007

After completion of a drilling program to define the uranium resource in Blyvoor’s slimes dam material, a 17.5 million
pound uranium and 0.8 million ton sulphur resource was declared in November 2007.

2008

In January 2008, electricity supply to the mine was interrupted by the South African electricity company Eskom which is
government owned and production suspended for a week due to safety concerns.

2009

In January 2009, a direct lightning strike to No. 5 shaft Eskom sub-station interrupted production at No. 5 shaft and other
areas drawing power from this supply. Employees underground at the time remained in the underground refuge bays until
hoisted to safety once the shaft feeder power had been restored. No injuries were recorded.
In May and June 2009, three seismic events in excess of 3.5 magnitude took place at No. 5 shaft. As these events affected
the highest grade carbon leader mining area, production from these areas was expected to resume in the third quarter of the

2010 fiscal year and was back in full production since May 2010.
On November 9, 2009, we announced that, in a bid to save our Blyvoor mine from liquidation, we intended applying to the
High Court of South Africa for a provisional judicial management order over the operation. A provisional judicial
management order was granted by the High Court of South Africa on November 10, 2009.
In December 2009, Aurora Empowerment Systems Proprietary Limited proposed a transaction to purchase 60% of
Blyvoor for R295 million.

2010

In April 2010, the High Court of South Africa agreed to lift, with immediate effect, the provisional judicial management
order in place since November 10, 2009. By mutual agreement between DRDGOLD and Aurora, Aurora’s offer to
purchase 60% of Blyvoor was withdrawn.

2011

In June 2011, DRDGOLD's Board of Directors decided to suspend financial assistance to Blyvoor.
The Blyvoor Board of Directors, in response to the DRDGOLD Board’s decision, resolved to begin business rescue
proceedings for Blyvoor in terms of Chapter 6 of the South African Companies Act.

2012

On June 1, 2012, we sold our entire interest and claims against Blyvoor to Business Venture Investment No 1557
Proprietary Limited a wholly owned subsidiary of Village.

2013

The Blyvoor board resolves to place the company in provisional liquidation.

Geology and Mineralization

Prior to its provisional liquidation, Blyvoor exploited the two gold-bearing pebble horizons in the Central Rand

Goldfields, the Carbon Leader, which is one of the principal ore bodies in the goldfield, and the Middelvlei Reef horizons which
occur in discrete channels over parts of the lease area approximately 246 feet (75 meters) vertically above the Carbon Leader Reef
horizon.

Mining and Processing

Access from the surface to the current underground workings of the mines is through a system of vertical and incline shafts

situated at the Blyvoor and Doornfontein mines. The average mining depth at Blyvoor and Doornfontein is 10,541 feet (3,213 meters)
and 5,292 feet (1,613 meters) below mean sea level respectively. Mining of the reef took place in stope panels through drilling and
blasting. Blasted rock was removed from the stope panels and conveyed by shaft to the surface , and transported to the metallurgical
plant for gold extraction. Blyvoor used a cyanide leaching Carbon-in-Pulp, or CIP, process for the extraction of gold.

In fiscal 2012, before the sale of Blyvoor and following a decision of the board of directors of DRGOLD to withdraw

financial support from Blyvoor, it applied to be placed under Chapter 6 of the Companies Act business rescue protection when it
became apparent that the high costs of electricity charged during the winter months and the then lower price of gold would cause
Blyvoor to experience financial distress. Following a term payment arrangement with Eskom, the state owned electricity supplier
of South Africa and an increase in the gold price, the Business Rescue Practitioner who was appointed in terms of Chapter 6
terminated the business rescue proceedings with effect from November 10, 2011. This followed his conclusion that there were no
longer grounds to believe that Blyvoor was financially distressed. At the beginning of February 2012, Blyvoor suspended mining
from its Number 4 and 6 shafts as part of a process to reduce costs. On June 1, 2012, DRDGOLD sold its entire interest and claims
against Blyvoor and effectively transferred control to a wholly owned subsidiary of Village. DRDGOLD ceased consolidation of
Blyvoor from this date while Village commenced consolidating Blyvoor from said date. Refer to Item 4A.: “History and
Development of the Company” for a more detailed discussion. Following the provisional liquidation of Blyvoor during August 2013,
it remains under the control of the provisional liquidators.

The following capital expenditure was incurred at Blyvoor in fiscal 2012:

2012

R’000

Slimes pump stations and residue deposition ..............................................................

381

15/29 incline shaft equipping .......................................................................................

Ice plant retrofit and upgrade .......................................................................................

Safety related equipment and expansion of seismic monitoring network...................

Opening up and development .......................................................................................

50,315

Mining and engineering equipment ..............................................................................

23,326

Other ..............................................................................................................................

8,909

82,939

Environmental and Closure Aspects

Blyvoor had to maintain a rate of pumping of fissure water sufficient to keep the rate of rise of underground water below the

level of underground workings (approximately 2 million gallons (8 million liters) per day). Water not used in the operations was
discharged into the Wonderfontein Spruit (a stream adjacent to the Blyvoor mine). In order to address the risk of contamination of
ground water, streams and wetlands, Blyvoor took samples and monitored the level of contaminants in accordance with a water
management plan.

Blyvoor was a member of the Mining Interest Group consisting of all mines operating in the Wonderfontein Spruit

catchment area. This group was formed to coordinate efforts and studies in the Wonderfontein Spruit and to liaise with
government departments to determine what action if any is required in cleaning the stream. The government has also established a
specialist task team to determine what needs to be done. At the time of its sale no clear solution had been reached.

Sinkholes are caused by ground water seeping into the underground dolomitic structures, which dissolve and weaken

causing a collapse in the rock structure. Dolomitic rock could be dissolved, resulting in an increased risk of sinkholes and possible
pollution of fresh water resources stored in the dolomitic formations. At the time of its sale Blyvoor maintained close monitoring of
water leaks and ground subsidence to timely identify the formation of any possible sinkholes.

At the time of the sale, Blyvoor controlled dust pollution from slime dams by dust suppression and water management

programs. Short-term dust control was accomplished through ridge ploughing the top surface of dormant tailings dams.
Environmentally friendly dust suppressants, such as molasses, were also applied when deemed necessary. In the long-term, dust
suppression and water pollution was managed through a program of progressive vegetation of the tailings complexes followed by the
application of lime, to neutralize the natural acidic conditions, and fertilizer as the organic growth medium.

Blyvoor updated its EMP to meet the new requirements of the MPRD Act and submitted it to the DMR for approval.

Production in fiscal 2012

Blyvoor produced a total of 96,645 ounces of gold for the period July 1, 2011 to May 31, 2012 of fiscal 2012, with

73,048 ounces from underground areas and 23,597 ounces from surface areas. This represented 42% of our total production from
operations for fiscal 2012 of 232,353 ounces.

Cash operating costs of $1,404 per ounce in fiscal 2012 increased from $1,290 per ounce in fiscal 2011.

The following table details the operating and production results from Blyvoor for fiscal 2012.

Year ended June 30,

2012

Production (imperial)
Surface Operations
Ore mined ('000 tons) ....................................................................................

3,004

Recovered grade (oz/ton)

..............................................................................

0.008

Gold produced (ounces)

................................................................................

23,597

Underground Operations
Ore mined ('000 tons) ....................................................................................

627

Recovered grade (oz/ton)

..............................................................................

0.117

Gold produced (ounces)

................................................................................

73,048

Total ounces produced ....................................................................................

96,645

Results of Operations
Revenue (R'000) ..............................................................................................

1,240,073

Operating costs (R'000) ...................................................................................

1,046,914

Cash operating cost (R'000)

..........................................................................

1,052,197

Cash operating cost per ounce of gold ($)

....................................................

1,404

All-in sustaining cost per ounce of gold ($)¹ .................................................

1,543

All-in cost per ounce of gold ($)¹ ...................................................................

1,603

Cash operating costs, cash operating cost per ounce, all-in sustaining costs per ounce and all-in cost per ounce of gold are financial measures of

performance that we use to determine cash generating capacities of the mines and to monitor performance of our mining operations.

Durban Roodepoort Deep

Overview

The Durban Deep mine was the original gold mine of the Group. Durban Deep is situated on the northern edge of the

Witwatersrand Basin immediately to the west of Johannesburg. Mining took place within the lease area since the discovery of the
Witwatersrand Goldfield in 1886 at nearby Langlaagte.

As of August 2000, we ceased all underground and open pit mining operations at Durban Deep. Following the withdrawal

of our underground pumping subsidy, the deeper sections of the mine were flooded. On a combined basis, Durban Deep produced
more than 37 million ounces of gold prior to the cessation of operations.

We concluded an agreement with M5

Developments Proprietary Limited

("M5") on July 21, 2005, in terms of which M5,

against payment of a non-refundable fee of R1.5 million, was granted an option to acquire Durban Deep’s mine village for
R15.0 million. On the exercising of the option the option fee would be deemed part payment of the purchase consideration. If not, the
option fee would be forfeited to us.

On November 18, 2005, M5 exercised the option and provided a guarantee for payment. Prior to the registration of the

transfer occurring, we were notified by Rand Leases Properties Limited (formerly JCI Properties Limited) of an alleged pre-emptive
right in respect of the property in terms of an agreement dated December 1996, pursuant to which the property should be sold to them
on similar terms. We subsequently repudiated our agreement with M5 and notified Rand Leases Properties Limited that we did not
intend offering the property to them. Both parties instituted legal proceedings for the sale and transfer of the property. On
December 12, 2006, Rand Leases Properties Limited issued a summons against us and we filed an Appearance to Defend.
DRDGOLD entered into an agreement with Rand Leases Properties Limited ("Rand Leases Properties") and purchased the pre-
emptive right for an amount of R21.8 million. A sale agreement was concluded with Dino Properties Proprietary Limited ("Dino
Properties" previously called M5) and the transfer of the property into the name of Dino Properties was effected on October 18, 2012.
Both cases were subsequently withdrawn by Dino Properties and Rand Leases Properties respectively.

Environmental and Closure Aspects

Rehabilitation and other responsibilities like the National Nuclear Regulator Certificate of Registration requirements have

been taken over by DRD Proprietary Limited, which is owned by a subsidiary of Mintails South Africa Proprietary Limited
(“Mintails SA”). A liability transfer on the prescribed form in terms of section 43(2) of the MRPDA was submitted to the DMR in
July 2010. We are still awaiting approval of the transfer of environmental liabilities from the DMR.

In fiscal 2013, the Company transferred the environmental rehabilitation liabilities in respect of mining rights over the

Durban Deep mining license area which was disposed of to the purchaser of the mining rights . A total of R25.6 million previously
contributed to the Environmental Trust Fund has been relinquished to DRD Proprietary Limited as a result of the transfer of the
liability during fiscal 2013. DRDGOLD therefore still has a contingent liability until such legal transfer is effected, amounting to
R63.4 million less the trust fund amount of R26.8 million.

West Wits

We own 100% of West Witwatersrand Gold Holdings Limited, or WWGH, which holds West Witwatersrand Gold

Mines Limited, or West Wits. We acquired the entire share capital of WWGH, as well as Consolidated Mining Corporation Limited's
loan to WWGH, on April 1, 1996. We also acquired the entire issued share capital and the shareholders' claim and loan account of
East Champ d'Or Gold Mine Limited, a gold mining company with mining title in the West Rand. The mining assets were sold to
Bophelo Trading Proprietary Limited, subsequently renamed, Mogale Gold Proprietary Limited, or Mogale, during fiscal 2004,
effectively leading to the closure of the mining operation.

Environmental and Closure Aspects

Responsibility for the mine, including the environmental rehabilitation liability, has been taken over contractually by

Mintails although the legal transfer thereof would be dependent on the DMR's assessment of Mintails' financial capability.
DRDGOLD therefore still has a contingent liability until such legal transfer is affected. Management of the West Rand Consolidated
Mines' tailings dams have been taken over by Mintails which plans to reprocess them. An EMP for the balance of the area has been
submitted to the DMR as part of the conversion process of ML9/2000. The Old Order Mining Licence was converted to a New Order
Mining Right and ceded same to West Wits Monarch Proprietary Limited (“the Cessionary”).

The DMR and affected mining companies are involved in the development of a ‘Regional Mine Closure Strategy’ in the

gold fields’ area. The government has appointed Trans-Caledon Tunnel Authority to propose solutions for the various basins. They
have also provided funding for the interim solution in the Western and Central Basins.

In fiscal 2010, the Company transferred the environmental rehabilitation liabilities in respect of mining rights over the West

Wits mining license area which was disposed of. A total of R19.9 million previously contributed to the Environmental Trust Fund has
been relinquished to Mintails as a result of the transfer of the liability.

Ongoing Legal Proceedings

Litigation regarding environmental issues

On August 2, 2006 and September 4, 2006, two applications were brought against DRDGOLD and its directors for relief

under the MPRD Act by the Legal Resources Centre on behalf of the residents of two communities, Davidsonville and Kagiso, who
reside adjacent to tailings deposition sites of the now dormant Durban Roodepoort Deep mine and the West Witwatersrand mine,
respectively. While no financial compensation is sought, the communities are seeking orders for the revision of the environmental
management programs of both sites, and for the sites to be rehabilitated and closed in accordance with the standards of the MPRD
Act. In fiscal 2014, DRDGOLD has filed its Appearance to Defend and Answering Affidavits in respect of both matters in the High
Court of South Africa. The responsibility rests with the respondent's attorneys to either apply to the High Court for a date of hearing
or file replying affidavits.

Dispute with the Ekurhuleni Municipality

The Ekurhuleni Municipality has brought an action against ERPM claiming an amount of R42.0 million in respect of

outstanding rates and taxes which are allegedly owing. As at June 30, 2014, the difference between the invoiced amount and
ERPM’s calculations amounted to R55.8 million. ERPM has employed experts to investigate the allegations and believes that this
claim is unfounded. ERPM is defending this action on the belief that there are sufficient defences to repel the claim, therefore an
outflow of resources is remote.

Appeal hearing against valuation of properties by the Ekurhuleni Municipality

ERPM is involved in a further dispute with the Ekurhuleni Metropolitan Municipality in respect of the valuation of various

freehold properties of which ERPM is the registered owner. The aggregate valuation of these properties is approximately R400
million. ERPM has appealed against these valuations in terms of the provisions of the Local Government: Municipal Property Rates
Act, 6 of 2004 on the basis of inter alia the calculation methodology employed by the Municipal Valuer on behalf of the
Municipality. The hearings in respect of the appeal were heard in June 2013. ERPM’s challenge of the valuations was successful
when Valuation Appeal Board set aside the valuations during March 2014.

Silicosis Litigation

As a result of the South African Constitutional Court decision permitting individuals employed as miners with occupational

In January 2013 DRDGOLD, ERPM and 23 other mining companies were served with a court application for a class

action issued in the South Gauteng High Court by alleged former mineworkers and dependants of deceased mineworkers. In the
pending application the applicants allege that DRDGOLD, ERPM and other mining companies conducted underground mining
operations in such a negligent manner that the former mineworkers contracted silicosis. The applicants have not yet quantified the
amounts which they would like the mining companies to pay as damages.

The companies are currently gathering information in preparation for the matter. An answering affidavit opposing the

application for the certification of a class action was filed with the High Court on 24 June 2014.

Taking into account that the silicosis claim is still at certification stage and should anyone bring similar claims against

DRDGOLD or any of its subsidiaries in future, those claimants would need to provide evidence proving that silicosis was
contracted while in the employment of the company and that it was contracted due to negligence on the company’s part. The link
between the cause (negligence by the company while in its employ) and the effect (the silicosis) will be an essential part of any
case. It is therefore uncertain as to whether the company will incur any costs related to silicosis claims in the future and due to the
limited information available on any claims and potential claims and the uncertainty of the outcome of these claims, no reliable
estimation can be made for the possible obligation.

ITEM 4A. UNRESOLVED STAFF COMMENTS

None.

ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS

The following Operating and Financial Review and Prospects section is intended to help the reader understand the factors

that have affected the Company's financial condition and results of operations for the historical period covered by the financial
statements and management's assessment of factors and trends which are anticipated to have a material effect on the Company's
financial condition and results in future periods. This section is provided as a supplement to, and 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.

· The Operating and Financial Review and Prospects include the following sections:

Operating results:

Business overview, a general description of our business.

Key drivers of our operating results and principal factors affecting our operating results, a general description of the
principal uncertainties and variables facing our business and the primary factors that have a significant impact on our
operating performance.

Recent developments, a description of the recent acquisitions, disposals and other transactions that have impacted, or
will impact, our performance.

Key financial and operating indicators, a presentation of the key financial measures we use to track our operating
performance.

Application of critical accounting policies, a discussion of accounting policies that require critical judgments and
estimates.

Operating results, an analysis of our group results of operations during the three fiscal years presented in our
financial statements. The analysis is presented both on a group basis, and by operating segment.

· Liquidity and capital resources, an analysis of our cash flows, borrowings and our anticipated funding requirements and
sources.

· Research and development, patents and licenses, etc.

· Trend information, a review of the outlook for, and trends affecting our business.

· Off-balance sheet arrangements.

· Tabular disclosure of contractual obligations, being the numerical review of our contractual future cash obligations.

· Safe harbor.

5A. OPERATING RESULTS

Business overview

We are a South African gold mining company engaged in surface gold tailings retreatment, including exploration,

Our strategy is to sustainably and through the appropriate deployment of capital and resources optimally exploit these,

on-surface resources and to expand our reach and create growth opportunities through the improvement and development of
innovative technologies.

This strategy involves investment and value creation in respect of all the capital stocks of sustainable development -

In the longer term DRDGOLD will seek to improve gold recovery so that, in future, the absolute minimum amount of

gold is returned to tailings deposition facilities along with the waste material and to growing our reclamation business by:

· the use of technology and continuing research and development to improve reclamation efficiency and effectiveness;
· acquiring additional surface resources on the Witwatersrand and, possibly, other areas; and
· using existing expertise and skills to expand into the reclamation of other minerals from waste material.

In line with our focus on surface re-treatment, we disposed of our last operating underground operation, Blyvooruitzicht

Gold Mining Company Limited, or Blyvoor on June 1, 2012. Blyvoor has therefore been classified as a discontinued operation in
fiscal 2012 in the comparative periods in this Annual Report.

In fiscal 2010, the Group broadened its activities to include initial exploration activities on a small scale in Zimbabwe

During the fiscal years presented in this Annual Report, all of our operations took place in one geographic region, namely

South Africa.

Set forth below is a brief overview of our operations.

Ergo (Continuing operations):

· Ergo Mining Proprietary Limited (the entity is referred to as Ergo Mining, however the operating segment is called Ergo)
– surface tailings retreatment; and
· East Rand Proprietary Mines Limited (ERPM) – ERPM Extension 1 and 2 exploration tenements. ERPM’s underground
mining operation has been discontinued and is included under ‘Corporate office and other reconciling items’ in our
financial statements’ operating segments. On July 25, 2014, DRDGOLD announced that its subsidiaries Ergo Mining
Operations Proprietary Limited (EMO) and ERPM collectively had entered into an agreement to dispose of certain
underground mining and prospecting rights held by ERPM, and certain other assets on the related mining areas, for an
agreed consideration of R220 million. This agreement is subject to a number of suspensive conditions including
regulatory consent and permission which had not been fulfilled at the date of this report.

Blyvoor (discontinued operation):

· Blyvooruitzicht Gold Mining Company Limited (Blyvoor) – underground mining and surface tailings retreatment
disposed on June 1, 2012.

In fiscal 2014, the loss from continuing operations was R54.7 million (2013: profit of R97.7 million and 2012: profit of

R250.8 million) and profit from discontinued operations was Rnil (2013: Rnil, 2012: R124.0 million).

As at June 30, 2014, we had attributable Ore Reserves of approximately 1.5 million ounces, compared to 1.7 million

ounces as at June 30, 2013 and 1.8 million at June 30, 2012.

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;
· The production tonnages and gold content thereof, impacting on the amount of gold we produce at our operations;
· The cost of producing gold, including the effects of mining efficiencies; and
· 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 may affect 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. As a general rule we sell the gold produced at market prices to obtain
the maximum benefit from prevailing gold prices and we do not hedge against changes in gold prices.

The following table indicates data relating to the dollar gold spot price for the 2014, 2013 and 2012 fiscal years:

2014 fiscal year

2013 fiscal year

% change

Opening gold spot price on July 1,

$1,192 per ounce

$1,599 per ounce

(25%)

Closing gold spot price on June 30,

$1,315 per ounce

$1,192 per ounce

10%

Lowest gold spot price during the fiscal year

$1,192 per ounce

Highest gold spot price during the fiscal year

$1,426 per ounce

$1,792 per ounce

(20%)

Average gold spot price for the fiscal year

$1,296 per ounce

$1,606 per ounce

(19%)

2013 fiscal year

2012 fiscal year

% change

Opening gold spot price on July 1, ....................................

$1,599 per ounce

$1,506 per ounce

Closing gold spot price on June 30, ..................................

$1,192 per ounce

$1,599 per ounce

(25%)

Lowest gold spot price during the fiscal year ...................

$1,192 per ounce

$1,483 per ounce

(20%)

Highest gold spot price during the fiscal year ...................

$1,792 per ounce

$1,895 per ounce

(5%)

Average gold spot price for the fiscal year .......................

$1,606 per ounce

$1,673 per ounce

(4%)

2012 fiscal year

2011 fiscal year

% change

Opening gold spot price on July 1, ....................................

$1,506 per ounce

$1,244 per ounce

21%

Closing gold spot price on June 30, ..................................

$1,599 per ounce

$1,506 per ounce

Lowest gold spot price during the fiscal year ...................

$1,483 per ounce

$1,157 per ounce

28%

Highest gold spot price during the fiscal year ...................

$1,895 per ounce

$1,553 per ounce

22%

Average gold spot price for the fiscal year .......................

$1,673 per ounce

$1,369 per ounce

22%

Our production has been sourced from 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) increased from
R12,970 per ounce in 2012 (a 36% increase from fiscal 2011) to R14,185 per ounce in 2013 (a 9% increase from fiscal 2012) with
a decrease to R13,614 per ounce in 2014, a 4% decrease from fiscal 2013.

Based on our forecast gold price of R453,121 per kilogram for fiscal 2015, a 10% increase in the rand gold price

received will increase our forecast profit for the year by R188.5 million and a 10% decrease in the rand gold price received will
decrease our profit for the year by R188.1 million.

Gold production and operating costs

In fiscal 2014, total production from all operations decreased to 132,909 ounces (produced from 23.9 million tonnes

milled at an average yield of 0.173g/t) from 146,381 ounces in fiscal 2013 (produced from 23.3 million tonnes milled at an
average yield of 0.20g/t) and 232,353 ounces in fiscal 2012 (produced from 24.9 million tonnes milled at an average yield of
0.29g/t).

In fiscal 2014, production from our continuing operations decreased to 132,909 ounces (produced from 23.9 million

tonnes milled at an average yield of 0.173g/t) from 146,381 ounces in fiscal 2013 (produced from 23.3 million tonnes milled at an
average yield of 0.20g/t). In fiscal 2013 the production increased from 135,708 ounces (from 21.6 million tonnes milled at an
average yield of 0.20g/t) in fiscal 2012.

The decrease in total production as well as production from our continuing operations during fiscal 2014 was due to

lower than expected recoveries in the FFG circuit as well as production in the FFG being temporarily suspended to introduce a
number of engineering upgrades and to revisit the plant's carbon management regime.

The increase in production from our continuing operations during fiscal 2013 was due to a rise in throughput, resulting

from the Crown/Ergo pipeline being fully operational during fiscal 2013 while the decrease in total production was due to the
Blyvoor being sold in late fiscal 2012. Our discontinued operation, Blyvoor produced 96,645 ounces (from 3.3 million tonnes
milled at an average yield of 0.91g/t) during fiscal 2012 before its disposal on June 1, 2012.

Our costs and expenses consist primarily of operating costs and depreciation. Operating costs include labor, specialized

service providers, stores, electricity and other related costs, incurred in the production of gold. ‘Consumables and other’ and
'specialized services' are the largest components of operating costs, constituting respectively, 52% and 15% of the operating cost
for fiscal 2014, compared to 46% and 19% of operating costs for fiscal 2013. "Consumables and other" and 'labor' constituted
48% and 18%, respectively, of our operating costs from continuing operations for fiscal 2012.

During fiscal 2014 the cash operating costs per kilogram increased by 20% for continuing and discontinued operations

(2013: 2%, 2012: 21%) mainly due to lower gold production as well as above inflation increases in prices of key consumables,
labor and electricity.

General economic factors

All our operations are located in South Africa. 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 recognize the inherent risks and uncertainties of the industry, and the wasting nature of the assets.

Effect of exchange rate fluctuations

For the years ended June 30, 2014 and June 30, 2013 all of our revenues were generated from South Africa, all of our

operating costs were denominated in rand and we derived all of our revenues in dollars. As the price of gold is denominated in
dollars and we realize our revenues in dollars, the appreciation of the dollar against the rand increases our profitability, whereas
the depreciation of the dollar against the rand reduces our profitability.

Based upon average exchange rates during the respective years, the rand weakened by 17% against the dollar in fiscal

2014, compared to a weakening of 14% against the dollar in fiscal 2013 and a weakening of 11% against the dollar in fiscal 2012.

In both fiscal 2014 and 2013 the weakening of the rand against the dollar was outweighed by a weakening in the Dollar

gold price. This resulted in a decrease in the Rand gold price received of 6% in fiscal 2014 and a 9% increase in fiscal 2013. The
weakening of the rand against the dollar in fiscal 2012 was accompanied by a strengthening of the gold price and resulted in an
increase in the Rand gold price received of 36%.

As an unhedged gold producer, we 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.

Our cash operating costs per kilogram for our operations was R372,671 per kilogram of gold produced in fiscal 2014,

R310,763, per kilogram of gold produced in fiscal 2013 and R304,912 per kilogram of gold produced in fiscal 2012. Our cash
operating costs per kilogram for our continuing operation was R372,671 per kilogram of gold produced in fiscal 2014, R310,763
per kilogram of gold produced in fiscal 2013 and R272,778 per kilogram of gold produced in fiscal 2012. For fiscal 2012, our
cash operating costs per kilogram for our discontinued operation was R350,032 per kilogram of gold produced.

Effect of inflation

In the past, our operations have been materially adversely affected by inflation. If there is a significant increase in

inflation in South Africa without a concurrent devaluation of the rand or an increase in the price of gold, our costs will increase,
negatively affecting 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 ended

Year ended June 30,

2014

(%)

2013

(%)

2012

(%)

The average rand/dollar exchange rate weakened by .....................................................................

CPI (inflation rate) ...........................................................................................................................

6.6

5.5

South African political, economic and other factors

We are a South African company and all our revenue producing operations are based in South Africa. As a result, we are

subject to various economic, fiscal, monetary and political factors that affect South African companies generally, including
exchange control regulations. Governmental officials have from time to time stated their intentions to lift South Africa’s exchange
control regulations when economic conditions permit such action. Over the last few years, certain aspects of exchange controls for
companies and individuals have been incrementally relaxed. It is, however, impossible to predict when, if ever, the South African
Government will remove exchange controls in their entirety. South African companies remain subject to restrictions on their
ability to export and deploy capital outside of the Southern African Common Monetary Area, unless dispensation has been
granted by the South African Reserve Bank. For a detailed discussion of exchange controls, see Item 10D.: “Exchange controls.”

On May 1, 2004, the Mineral and Petroleum Resources Development Act (MPRD Act) became effective. Prior to the

introduction of the MPRD Act, private ownership in mineral rights and statutory mining rights in South Africa could be acquired
through the common law or by statute. Now, all mineral rights have been placed under the custodianship of the South African
Government under the provisions of the MPRD Act, and "old order" proprietary rights need to be converted to "new order" rights
of use within certain prescribed periods. We have submitted certain applications in this regard. This process is described in more
detail under Item 4B.: “Business Overview – Governmental regulations and their effects on our business - South Africa - Common
Law Mineral Rights and Statutory Mining Rights.”

Recent developments

Ergo (includes Ergo Mining, ErgoGold, Crown and ERPM’s Cason dump)

On July 1, 2012, DRDGOLD restructured the group’s surface operations into Ergo Mining in order to improve synergies,

affect cost savings and implement a simpler group structure. Ergo Mining is a wholly-owned subsidiary of Ergo Mining
Operations Proprietary Limited, or EMO. EMO is 74% held by DRDGOLD, 20% by its black economic empowerment (BEE)
partner, Khumo Gold SPV Proprietary Limited (Khumo Gold) and 6% by the DRDSA Empowerment Trust.

Various transactions to give effect to the restructuring have been entered into, in terms of which:

· DRDGOLD sold its 35% direct interest in the ErgoGold unincorporated partnership to Ergo Mining for R200
million on loan account;
· Crown Gold Recoveries Proprietary Limited, or Crown sold its mining assets (excluding its 50% interest in Ergo
Mining), mining and prospecting rights and certain liabilities to Ergo Mining for shares in Ergo Mining;
· ERPM sold all of its surface mining assets (excluding its 50% interest in Ergo Mining) and its 65% interest in
ErgoGold to Ergo Mining in exchange for shares in Ergo Mining; and
· Crown and ERPM will distribute their entire holdings in Ergo Mining to sole shareholder EMO.

In terms of the restructuring of the group’s surface operations into one business segment, ERGO Mining, the requisite

applications in terms of section 11 of the MPRD Act to obtain Ministerial consent were lodged by ERPM and Crown in March
2013. We are still awaiting the procurement of the approval of the Minister.

Blyvoor

On February 11, 2012, DRDGOLD, Village Main Reef Limited (Village), Blyvoor and Business Venture Investments

No 1557 Proprietary Limited (a wholly owned subsidiary of Village) (Purchaser) entered into a sale of shares and claims
agreement. Pursuant to terms of the Agreement, DRDGOLD agreed to sell its entire shareholding in Blyvoor (which amounts to
74% of the total issued ordinary share capital of Blyvoor) (Sale Shares) and its working capital and shareholder loan claims
against Blyvoor, or the Sale Claims to the Purchaser, the Transaction. The Transaction is divided into the Part A Sale and the Part
B Sale. In terms of the Part A Sale, the Sale Claims are sold to the Purchaser, and in terms of the Part B Sale, the Sale Shares are
sold to the Purchaser. The purchase consideration payable in respect of the Sale Claims and the Sale Shares shall be discharged by
Village through the issue of 85,714,286 new ordinary shares in Village (Village Shares) to DRDGOLD and an amount of R1
payable in cash by Village, respectively.

The Part A Sale was completed on June 1, 2012, at which time 65,714,286 of the Village Shares were issued directly to

DRDGOLD and 20,000,000 are held in escrow (Escrow Shares) pending completion of the Part B Sale.

The Part B Sale is subject to the fulfillment, or waiver (if applicable), of the following conditions precedent:

· by not later than the second anniversary of the signature date of the Agreement, the Department of Mineral
Resources (DMR) has granted the conversion of Blyvoor's old order mining right and the new order mining right has
been notarially executed and registered in the Mining Titles Office or Conversion; and
· by not later than the third anniversary of the signature date of the Agreement, the DMR has unconditionally
approved the transfer of DRDGOLD's interest in Blyvoor to the Purchaser in terms of section 11 of the Mineral &
Petroleum Resources Development Act, No 28 of 2002 or conditionally approved it on terms and conditions which
each of DRDGOLD and the Purchaser confirms to be acceptable (Section 11 Approval).

Upon fulfillment of the Part B Conditions Precedent, the Escrow Shares together with any accrued dividends thereon will

be released to DRDGOLD and the Sale Shares will be transferred to the Purchaser.

If Conversion does not occur in accordance with the terms of the Agreement, or Conversion occurs but Section 11

Approval is not obtained, and unless it did not occur as a consequence of a Prejudicial Act on the part of either of the Parties, any
one, or more, of the following may occur:

· the sale of the Sale Shares is implemented and the Sale Shares are transferred to the Purchaser;
· a portion of the Sale Claims revert to DRDGOLD;
· the Escrow Shares together with any accrued dividends thereon are released to DRDGOLD or to the Purchaser;
· the appointment of the Purchaser as DRDGOLD’s agent to render corporate services on behalf of DRDGOLD to Blyvoor
continues or is terminated; and/or
· the DRDGOLD’s right to receive dividends in respect of the Sale Shares is reinstated.

A dispute is currently pending between DRDGOLD and Village insofar as the completion of this, the Blyvoor sale is

concerned, after Village failed to attend to certain administrative steps associated with the registration of Blyvoor’s New Order
Mining Rights. DRDGOLD is alleging that this constituted a breach of contract and a Prejudicial Act on the part of Village, which
brings about a deemed compliance and entitles DRDGOLD to relief.

Blyvoor was also placed under provisional liquidation by the Village controlled Blyvoor board in August 2013 and has since

been under the control of the provisional liquidators that were appointed by the High Court of South Africa.

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 years ended June 30, 2014, 2013 and 2012 below are stated in accordance with IFRS as issued by the IASB. The table also
includes the key performance measures for the growth of our business and its profitability, which are gold revenue, production,
operating costs, cash operating costs per kilogram, all-in sustaining costs per kilogram and all-in costs per kilogram, capital
expenditure and Ore Reserves.

Operating data

Year ended June 30,

2014

2013

2012

Total operations

Revenue (R'000) ...........................................................................................................

1,809,434

2,076,496

3,004,264

Gold production (ounces) .............................................................................................

132,909

146,381

232,353

Gold production (kilograms) ........................................................................................

4,134

4,553

7,227

Revenue (R/kilogram) ..................................................................................................

437,696

456,072

415,700

Average gold price received (R/kilogram) ...................................................................

432 775

458,084

418,538

Net operating costs (R'000) ..........................................................................................

1,549,400

1,397,177

2,188,887

Cash operating costs (R'000) ........................................................................................

1,540,622

1,414,904

2,203,597

Cash operating costs (R/kilogram)

..............................................................................

372,671

310,763

304,912

All-in sustaining costs (R/kilogram)¹ ...........................................................................

401,691

362,599

355,571

All-in costs (R/kilogram)¹ .............................................................................................

436,503

433,669

391,732

Additions to property, plant and equipment - cash (R'000).........................................

158,593

368,478

319,097

Ore Reserves (ounces) ..................................................................................................

1,524,000

1,676,000

1,825,000

Continuing operations
Revenue (R'000) ...........................................................................................................

1,809,434

2,076,496

1,764,191

Gold production (ounces) .............................................................................................

132,909

146,381

135,708

Gold production (kilograms) ........................................................................................

4,134

4,553

4,221

Revenue (R/kilogram) ..................................................................................................

437,696

456,072

417,956

Average gold price received (R/kilogram) ...................................................................

432 775

458,084

418,849

Net operating costs (R'000) ..........................................................................................

1,549,400

1,397,177

1,141,973

Cash operating costs (R'000) ........................................................................................

1,540,622

1,414,904

1,151,400

Cash operating costs (R/kilogram)¹ ..............................................................................

372,671

310,763

272,779

All-in sustaining costs (R/kilogram)¹ ...........................................................................

401,691

362,599

334,834

All-in costs (R/kilogram)¹ .............................................................................................

436,503

433,669

386,149

Additions to property, plant and equipment - cash (R'000) .........................................

158,593

368,478

236,410

Ore Reserves (ounces) ..................................................................................................

1,524,000

1,676,000

1,825,000

Discontinued operation
Revenue (R'000) ...........................................................................................................

n/a

1,240,073

Gold production (ounces) .............................................................................................

n/a

96,645

Gold production (kilograms) ........................................................................................

n/a

3,006

Revenue (R/kilogram) ..................................................................................................

n/a

412,533

Average gold price received (R/kilogram) ...................................................................

n/a

418,096

Net operating costs (R'000) ..........................................................................................

n/a

1,046,914

Cash operating costs (R'000) ........................................................................................

n/a

1,052,197

Cash operating costs (R/kilogram)¹ ..............................................................................

n/a

350,032

All-in sustaining costs (R/kilogram)¹ ...........................................................................

n/a

384,689

All-in costs (R/kilogram)¹ .............................................................................................

n/a

399,572

Additions to property, plant and equipment - cash (R'000) .........................................

n/a

82,938

Ore Reserves (ounces) ..................................................................................................

n/a

Cash operating costs, all-in sustaining costs and all-in costs are non-IFRS financial measures of performance that we use to determine cash

generating capacities of the mines and to monitor performance of our mining operations. For a reconciliation of those measures to operating
costs, see Item 5A.: “Operating Results” - “Reconciliation of cash cost per kilogram, all-in sustaining costs per kilogram, all-in costs per
kilogram and capital expenditure (cash).”

Revenue

Revenue is derived from the sale of gold. The following table analyzes our revenue for the periods under review for

continuing and discontinued operations:

Year ended June 30,

2014

R'000

2013

R'000

2012

R'000

Continuing operations

Ergo..................................................................................................................................... 1,809,434

2,076,496

1,764,191

Discontinued operation

Blyvoor ...............................................................................................................................

n/a

1,240,073

Total ....................................................................................................................................... 1,809,434

2,076,496

3,004,264

Revenue dropped from R2,076 million in fiscal 2013 to R1,809 million in fiscal 2014 mainly due to a 9% drop in gold

production and a 6% drop in the average gold price received. The increase in revenue from continuing operations in fiscal 2013
was due to an 8% increase in throughput from the Crown/Ergo pipeline which was operational for the whole of fiscal 2013 and a
9% increase in the rand dollar gold price.

Gold production

The following table analyzes the production for the periods under review for continuing and discontinued operations:

Year ended June 30

2014

2013

2012

Ounces

Kilograms

Ounces

Kilograms

Ounces

Kilograms

Continuing operations

Ergo..............................................................

132,909

4,134

146,381

4,553

135,708

4,221

Discontinued operation

Blyvoor

........................................................

96,645

3,006

Surface operations .....................................

23,597

734

Underground

operations

............................

73,048

2,272

Total production ...........................................

132,909

4,134

146,381

4,553

232,353

7,227

Our total gold production as well as production from our continuing operations during fiscal 2014 decreased by 13,472

ounces, or 9%, to 132,909 ounces from 146,381 ounces produced in fiscal 2013 due to lower than expected recoveries in the FFG
circuit as well as production in the FFG being temporarily suspended to introduce a number of engineering upgrades and to revisit
its carbon management regime.

For fiscal 2013, our total gold production decreased by 85,972 ounces, or 37%, to 146,381 ounces from 232,353 ounces

produced in fiscal 2012 due to the Blyvoor being sold in late fiscal 2012. At Ergo, total gold production was 10,673 ounces or 8%
higher at 146,381 ounces (fiscal 2012: 135,708 ounces). This reflected a 8% rise in throughput to 23,254,000 tonnes (fiscal 2012:
21,603,000 tonnes) resulting from the completion of the Crown/Ergo pipeline and transport of increased volumes of ore to the
plant.

Cash operating costs

, all-in sustaining costs and all-in costs per kilogram¹

For fiscal 2014, cash operating costs from continuing and discontinued operations increased to R372,671 per kilogram of

gold from R310,763 per kilogram of gold in fiscal 2013. All-in sustaining costs per kilogram increased to R401,691 per kilogram
of gold in fiscal 2014 from R362,599 per kilogram of gold in fiscal 2013. All-in costs per kilogram increased to R436,503 per
kilogram of gold in fiscal 2014 from R433,669 per kilogram of gold in fiscal 2013. The increase in cash operating costs and all-in
sustaining costs per kilogram were due to lower gold production and above inflation increases in prices of key consumables, labor
and electricity. The increase in the all-in sustaining costs was lower than the increase in cash operating costs reflecting the
decrease in corporate costs. The total all-in costs per kilogram increased despite the decrease in non-sustaining capital relating to
the completion of the flotation and fine-grind project primarily due to the foregoing as well as the R26.5 million capital
recoupment that was in recognised by the head office fiscal 2013 that did not recur in fiscal 2014.

For fiscal 2013, cash operating costs from continuing and discontinued operations increased to R310,763 per kilogram of

gold from R304,912 per kilogram of gold in fiscal 2012. All-in sustaining costs per kilogram increased to R362,599 per kilogram
of gold in fiscal 2013 from R355,571 per kilogram of gold in fiscal 2012. All-in costs per kilogram increased to R433,669 per
kilogram of gold in fiscal 2013 from R391,732 per kilogram of gold in fiscal 2012. The increase in cash operating costs and all-in
sustaining costs per kilogram of gold produced in fiscal 2013 was due to above inflation increases in prices of key consumables,
labor and electricity and, for all-in sustaining costs, the increase in corporate costs relating to a new business unit aimed
specifically at researching new business opportunities.. The increase in all-in costs per kilogram was primarily due to the
foregoing and the non-recurring increase in non-sustaining capital relating to the flotation and fine-grind project, offset by a
R26.5 million capital recoupment.

Ergo's cash operating costs for fiscal 2014 increased to R372,671 per kilogram of gold from R310,763 per kilogram of gold

in fiscal 2013. All-in sustaining costs per kilogram increased to R395,278 per kilogram of gold in fiscal 2014 from R359,166 per
kilogram of gold in fiscal 2013. All-in costs per kilogram decreased to R425,001 per kilogram of gold in fiscal 2014 from R426,546
per kilogram of gold in fiscal 2013. The increase in cash operating costs and all-in sustaining costs per kilogram were due to lower
gold production and above inflation increases in prices of key consumables, labor and electricity. The increase in the all-in
sustaining costs was lower than the increase in cash operating costs reflecting the decrease in corporate costs. The all-in costs per
kilogram decreased despite the increased outlined above due to the significant decrease in non-sustaining capital relating to the
completion of the flotation and fine-grind project.

Ergo's cash operating costs for fiscal 2013 increased to R310,763 per kilogram of gold from R272,779 per kilogram of gold

in fiscal 2012. All-in sustaining costs per kilogram increased to R359,166 per kilogram of gold in fiscal 2013 from R317,884 per
kilogram of gold in fiscal 2012. All-in costs per kilogram increased to R426,546 per kilogram of gold in fiscal 2013 from R360,466
per kilogram of gold in fiscal 2012. The increase in cash operating costs and all-in sustaining costs per kilogram were due to above
inflation increases in prices of key consumables, labor and electricity and, for all-in sustaining costs, the increase in corporate
costs relating to a new business unit aimed specifically at researching new business opportunities. The increase in all-in costs per
kilogram was primarily due to the foregoing and to the non-recurring increase in non-sustaining capital expenditure relating to the
flotation and fine-grind project.

Reconciliation of cash operating costs per kilogram, all-in sustaining costs per kilogram, all-in costs per kilogram and capital
expenditure (cash)

Cash operating costs include costs for all mining, processing, administration, royalties and production taxes, but exclude

depreciation, depletion and amortization, rehabilitation, retrenchment costs and corporate administration costs. Cash operating
costs per kilogram are calculated by dividing cash operating costs by kilograms of gold produced. Cash operating costs per
kilogram have been calculated on a consistent basis for all periods presented.

All-in sustaining costs per kilogram is a measure on which guidance was provided by the World Gold Council and

include cash operating costs of production plus, on-site general and administrative costs, royalties and production taxes, sustaining
capital, sustaining exploration, the accretion of rehabilitation costs, but excludes depreciation, retrenchment costs, finance costs,
depletion and amortization, reclamation and closure costs. All-in sustaining costs per kilogram are calculated by dividing all-in
sustaining costs by kilograms of gold produced. All-in sustaining costs per kilogram have been calculated on a consistent basis for
all periods presented.

Cash operating costs, all-in sustaining costs and all-in costs per kilogram are non-IFRS financial measures of performance that we use to

determine cash generating capacities of the mines and to monitor performance of our mining operations.

All-in costs per kilogram is a measure on which guidance were provided by the World Gold Council and include total

operating costs, plus all-in sustaining costs, non-sustaining capital costs relating to projects, retrenchment costs, capital
recoupment relating to non-sustaining capital, ongoing rehabilitation expenditure, and non-operating costs, but exclude taxation,
minority interest, finance costs, profit or loss from associates and the cumulative effect of accounting adjustments. All-in costs per
kilogram are calculated by dividing all-in costs by kilograms of gold produced. All-in costs per kilogram have been calculated on
a consistent basis for all periods presented.

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 operating costs, 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 provided guidance for
the calculation of cash operating costs, the calculation of cash operating costs per kilogram, all-in sustaining costs 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. However, we believe that cash operating costs per kilogram,
all-in sustaining costs per kilogram and all-in costs per kilogram 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;
· trends in costs;
· a measure of a mine's margin per kilogram, by comparison of the cash operating costs per kilogram by mine to the price
of gold; and
· a benchmark of performance to allow for comparison against other mines and mining companies.

Capital expenditure (cash) is the actual cash flow for the particular fiscal period as taken from the statement of cash flows

for additions to property, plant and equipment under investing activities.

A reconciliation of cash operating costs to operating costs as per our operating segment, all-in sustaining costs and all-in

costs for each of the years ended June 30, 2014, 2013 and 2012 is presented below. We have also provided below details of the
amount of gold produced by each mine for each of those periods.

For the year ended June 30, 2014
(in R'000, except as otherwise noted)

Continuing Operations

Discontinued

operation

Ergo

ERPM

Other

Total

Operating costs ..........................................................................

1,582,936

15,364

1,598,300

Ongoing rehabilitation expenditure ...........................................

(29,973)

(29,973)

Care and maintenance costs .......................................................

(15,364)

(15,364)

Other operating expenses ...........................................................

(12,341)

(12,341)

Cash operating costs

...............................................................

1,540,622

1,540,622

Movement in gold in process ....................................................

8,828

8,828

Net operating costs

1,549,450

1,549,450

Plus:

Administration expenses, general costs and other ..................

62,330

1,567

27,549

91,446

Movement in provision for environmental
rehabilitation ............................................................................

(82,281)

(4,324)

(86,605)

Unwinding of rehabilitation provision ....................................

36,300

1,719

38,019

Sustaining capital .....................................................................

68,279

68,279

All-in sustaining costs ..............................................................

1,634,078

(1,038)

27,549

1,660,589

Plus:

Retrenchment costs ..................................................................

1,074

1,086

4,588

6,748

Care and maintenance costs ....................................................

15,364

15,364

Ongoing rehabilitation expenditure ........................................

29,973

29,973

Capital recoupment ..................................................................

(1,276)

(1,276)

Non-sustaining capital .............................................................

93,106

93,106

All-in costs .................................................................................

1,756,955

15,412

32,137

1,804,504

Gold produced (ounces) .............................................................

132,909

132,909

Gold produced (kilograms) ........................................................

4,134

4,134

Cash operating costs per kilogram (R per kilogram) ................

372,671

372,671

All-in sustaining costs per kilogram (R per kilogram) .............

395,278

401,691

All-in costs per kilogram (R per kilogram) ...............................

425,001

436,503

In fiscal 2014 we had no discontinued operations.

Relates to other non-core operating entities within the Group and is included under ‘Corporate office and other reconciling items’ in our segmental reporting.

Cash operating costs equate to cash operating costs of production.

For the year ended June 30, 2013
(in R'000, except as otherwise noted)

Continuing Operations

Discontinued

operation

Ergo

ERPM

Other

Total

Operating costs ..........................................................................

1,477,188

20,251

1,497,439

Ongoing rehabilitation expenditure ...........................................

(45,444)

(45,444)

Care and maintenance costs .......................................................

(20,251)

(20,251)

Other operating expenses ...........................................................

(16,480)

(16,480)

Cash operating costs

...............................................................

1,414,904

1,414,904

Movement in gold in process ....................................................

(17,727)

(17,727)

Net operating costs

1,397,177

1,397,177

Plus:

Administration expenses, general costs and other ..................

75,358

8,382

16,917

100,657

Movement in provision for environmental
rehabilitation ............................................................................

35,694

(20,382)

15,334

Unwinding of rehabilitation provision ....................................

31,982

1,555

33,537

Sustaining capital .....................................................................

95,071

9,052

104,209

All-in sustaining costs ..............................................................

1,635,282

19,011

(3,379)

1,650,914

Plus:

Retrenchment costs ..................................................................

565

565

Care and maintenance costs ....................................................

20,251

20,251

Ongoing rehabilitation expenditure ........................................

45,444

45,444

Capital recoupment ..................................................................

(131)

(11,356)

(15,000)

(26,487)

Non-sustaining capital .............................................................

260,903

22,904

283,807

All-in costs .................................................................................

1,941,498

27,906

5,090

1,974,494

Gold produced (ounces) .............................................................

146,381

146,381

Gold produced (kilograms) ........................................................

4,553

4,553

Cash operating costs per kilogram (R per kilogram) ................

310,763

310,763

All-in sustaining costs per kilogram (R per kilogram) .............

359,166

362,599

All-in costs per kilogram (R per kilogram) ...............................

426,422

433,669

In fiscal 2013 we had no discontinued operations.

Relates to other non-core operating entities within the Group and is included under ‘Corporate office and other reconciling items’ in our segmental reporting.

Cash operating costs equate to cash operating costs of production.

For the year ended June 30, 2012
(in R'000, except as otherwise noted)

Continuing Operations

Discontinued

operation

Ergo

ERPM

Other

Total

Blyvoor

Total

Operating costs ..........................................................................

1,193,871

37,001

148

1,231,020

1,061,770

2,292,790

Ongoing rehabilitation expenditure ...........................................

(39,445)

(7,702)

(148)

(47,295)

(990)

(48,285)

Care and maintenance costs .......................................................

(29,299)

(29,299)

Other operating expenses ...........................................................

(3,026)

(3,026)

(8,583)

(11,609)

Cash operating costs

...............................................................

1,151,400

1,151,400

1,052,197

2,203,597

Movement in gold in process ....................................................

(9,427)

(9,427)

(5,283)

(14,710)

Net operating costs

1,141,973

1,141,973

1,046,914

2,188,887

Plus:

Administration expenses, general costs/(income) and other ..

68,792

10,636

30,252

109,680

25,613

135,293

Movement in provision for environmental
rehabilitation ............................................................................

48,292

9,861

1,333

59,486

(301)

59,185

Unwinding of rehabilitation provision ....................................

5,153

928

6,081

1,211

7,292

Sustaining capital .....................................................................

77,578

18,513

96,116

82,939

179,055

All-in sustaining costs ..............................................................

1,341,788

21,450

50,098

1,413,336

1,156,376

2,569,712

Plus:

Retrenchment costs ..................................................................

43,747

43,747

Care and maintenance costs ....................................................

29,299

29,299

Ongoing rehabilitation expenditure ........................................

39,445

7,702

148

47,295

990

48,285

Capital recoupment ..................................................................

(287)

(287)

Non-sustaining capital ............................................................ .

140,294

140,294

All-in costs .................................................................................

1,521,527

58,164

50,246

1,629,937

1,201,113

2,831,050

Gold produced (ounces) .............................................................

135,708

135,708

96,645

232,353

Gold produced (kilograms) ........................................................

4,221

4,221

3,006

7,227

Cash operating costs per kilogram (R per kilogram) ................

272,779

272,779

350,032

304,912

All-in sustaining costs per kilogram (R per kilogram) .............

317,884

334,834

384,689

355,571

All-in costs per kilogram (R per kilogram) ...............................

360,466

386,149

399,572

391,732

Ergo include Ergo, ErgoGold, Crown and ERPM’s surface Cason operation.

Relates to other non-core operating entities within the Group and is included under ‘Corporate office and other reconciling items’ in our segmental reporting.

Blyvoor was sold on June 1, 2012, and has been classified as a discontinued operation. Comparable prior year numbers have been adjusted to distinguish between continuing- and discontinued operations where

relevant.

Cash operating costs equate to cash operating costs of production.

Capital expenditure (cash)

During fiscal 2014, total additions to property, plant and equipment (cash) was R158.6 million, compared to

R368.5 million in fiscal 2013, a decrease of 57%. Additions to property, plant and equipment decreased primarily as a result of the
construction of the new flotation and fine-grind project being completed. In fiscal 2014, Ergo spent R89.5 million on the flotation
and fine-grind project, R32.4 million on Reclamation site 4A6, R6.2 million on rehabilitation of the Brakpan Tailings Dam and R
26.7 million on other capital items.

During fiscal 2013, total additions to property, plant and equipment (cash) was R368.5 million, compared to

R319.1 million in fiscal 2012, an increase of 15%. Additions to property, plant and equipment increased primarily as a result of
the new flotation and fine-grind project. In fiscal 2013, Ergo spent R261.5 million on the flotation and fine-grind project,
R11.7 million on the Brakpan TSF, R20.5 million on the Cason high grade plant, R30.4 million on the Angelo Pan reclamation
and pipeline, R26.3 million on infrastructure upgrades and R5.5 million on other equipment. For a detailed summary of capital
expenditure, see Item 4D.: “ Property, Plant and Equipment”.

Subsequent to June 30, 2014 and up to September 30, 2014 we spent R16.1 million on additions to property, plant and

equipment relating mainly to:

· The Rondebult sewerage water project amounting to R4.4 million, the Knights residue line amounting to R2.2 million, the
refurbishment of the No. 3 tailings thickener amounting to R3.6 million, residue linear screens amounting to R1.7 million
and various other capital items amounting to R4.2 million.

Ore Reserves

As at June 30, 2014, our Ore Reserves were estimated at 1.5 million ounces, as compared to 1.7 million ounces at

June 30, 2013, representing a 9% decrease. The decrease was mainly due to depletion. As at June 30, 2012, our Ore Reserves were
estimated at 1.8 million ounces resulting in a 6% decrease during fiscal 2013 due to depletion.

We seek to increase our attributable Ore Reserves through exploration and to acquire additional new Ore Reserves.

Year ended June 30,

2014

2013

2012

Ounces

Kilograms

Ounces

Kilograms

Ounces

Kilograms

‘000

Continuing operations

Ergo.............................................................

1,524

47,389

1,676

52,127

1,825

56,961

Discontinued operation

Blyvoor .......................................................

Total Ore Reserves ......................................

1,524

47,389

1,676

52,127

1,825

56,961

After the restructuring, Ergo's Reserves include the Elsburg and Benoni tailings complexes which are being processed by

Ergo, however the mining rights for these tailings are owned by ERPM. Crown's Ore reserves have also been included under Ergo.

Our Ore Reserves presented in Item 4B.: “Business Overview” and above are prepared using three year average gold prices

at the time of reserve determination for each year presented. For purposes of our financial statements, depreciation and impairment of
property, plant and equipment is determined based upon our "recoverable minerals", which means Proven and Probable Ore
Reserves, which are calculated using our life of mine business plans and the gold price at the end of each financial year.

Application of critical accounting policies

Some of our significant accounting policies require the application of significant judgment by management in selecting the

appropriate assumptions for calculating financial estimates. By their nature, these judgments are subject to an inherent degree of
uncertainty and are based on our historical experience, terms of existing contracts, management's view on trends in the gold mining
industry and information from outside sources.

Management believes the following critical accounting policies involve the more significant judgments and estimates used

in the preparation of our consolidated financial statements and could potentially impact our financial results and future financial
performance:

· Property, plant and equipment
· Impairment of property, plant and equipment
· Deferred income and mining taxes
· Future environmental rehabilitation costs
· Financial instruments

Management has discussed the development and selection of each of these critical accounting policies with the Board of

Directors and the Audit Committee, both of which have approved and reviewed the disclosure of these policies. Our significant
accounting policies relating to our accounting estimates and judgments are described in more detail in note 1 to the consolidated
financial statements. Refer to Item 18 “Financial statements’’. This discussion and analysis should be read in conjunction with the
consolidated financial statements and related notes included in Item 18 “Financial statements’’.

Property, plant and equipment

Actual expenditures incurred for mineral property interests, mine development costs, mine plant facilities and equipment are

capitalized to the specific mine to which the cost relates. Depreciation is calculated on a mine-by-mine basis using the units of
production method. Other assets are depreciated using the straight-line method over the expected life of these assets. Under the units
of production method, we estimate the depreciation rate based on actual production over total Proven and Probable Ore Reserves of
the particular mine, which are calculated using our life of mine business plans and a gold price at the end of each financial year.
This rate is then applied to actual costs capitalized to date to arrive at the depreciation expense for the period. Proven and Probable
Ore Reserves of the particular mine reflect estimated quantities of economically and legally recoverable reserves. Changes in
management’s estimates of the quantities of economically recoverable reserves impact depreciation on a prospective basis. The
estimate of the total reserves of our mines could be materially different from the actual gold mined due to changes in the factors used
in determining our Ore Reserves, such as the gold price, foreign currency exchange rates, labor costs, engineering evaluations of
assay values derived from sampling of drill holes and other openings. Any change in management’s estimate of the total Proven and
Probable Ore Reserves would impact the depreciation charges recorded in our consolidated financial statements. The prevailing
market price of gold at the end of the financial year was R408,381, R378,158 and R447,235 per kilogram for the fiscal years
ended June 30, 2012, 2013 and 2014, respectively.

Impairment of property, plant and equipment

The carrying amounts of assets, other than inventories and deferred tax assets are reviewed at each reporting date to

determine whether there is any indication of impairment. If any such indication exists, the asset's recoverable amount is estimated.
The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. In
assessing 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. Future cash flows are estimated based on
quantities of recoverable minerals, expected gold prices, production levels and cash operating costs of production, all based on life
of mine business plans. Refer to Item 4B Business Overview “Ore Reserves’’. For the purpose of impairment testing, assets are
grouped together into the smallest group of assets which generates cash inflows from continuing use that is largely independent of the
cash inflows of other assets or groups of assets, or the cash-generating unit. An impairment loss is recognized directly against the
carrying amount of the asset whenever the carrying amount of an asset, or its cash generating unit, exceeds its recoverable amount.
Impairment losses are recognized in profit or loss.

The recoverable amount of property, plant and equipment is generally determined utilizing discounted future cash flows. We

also consider such factors as our market capitalization, the quality of the individual ore body and country risk in determining the
recoverable amount. During fiscal 2014, R12.4 million (fiscal 2013: R61.0 million and fiscal 2012: Rnil) was recorded as an
impairment at a specific asset level.

In fiscal 2014, we calculated the recoverable amount based on updated life-of-mine business plans, an estimated gold price

of R453,121 per kilogram in year one escalating at 7.2% per annum, and a discount rate of 26.3%. With a 10% reduction in the gold
price an impairment of R894.2 million would be raised, or at an increase in the discount rate of 4.7 percentage points (18%) to 31.0%,
the group would begin impairment of the mining assets.

The R12.4 million impairment in fiscal 2014 was against Ergo's property, plant and equipment (exploration assets). The

R61.0 million impairment in fiscal 2013, consisted of R52.4 million against Ergo's property, plant and equipment (R40.0 million for
surface dumps and R12.4 million for plant equipment) and R8.6 million against ERPM’s plant equipment.

Deferred income and mining taxes

Deferred taxation is recognized in respect of temporary differences between the carrying amounts of assets and liabilities for

financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognized for the following temporary
differences: the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither
accounting nor taxable profit, and differences relating to investments in subsidiaries and jointly controlled entities to the extent that it
is probable that they will not reverse in the foreseeable future. In addition, deferred tax is not recognized for taxable temporary
differences arising on the initial recognition of goodwill. Deferred tax is measured at the tax rates that are expected to be applied to
the temporary differences, based on the expected manner of realization or settlement of the carrying amount of assets and liabilities,
and based on the laws that have been enacted or substantively enacted by the reporting date.

The amount recognized as a deferred tax asset is generally determined utilizing discounted future cash flows. We consider

all factors that could possibly affect the probability that future taxable profit will be available against which unused tax credits can be
utilized. These factors included profitability of the operations and an estimate of the gold price. The amount recognized as a deferred
tax asset is sensitive to the current gold spot price. As at June 30, 2014 we recognized a deferred tax asset of R1.4 million (June 30,
2013: R2.9 million and 2012: R38.3 million).

Future environmental rehabilitation costs

The decommissioning provision for environmental rehabilitation represents the cost that will arise from rectifying damage

caused before production commenced. Accordingly an asset is recognized and included within mining properties. Provisions for
environmental rehabilitation are provided at the present value of the expenditures expected to settle the obligation, using estimated
cash flows 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 for new circumstances or changes in law or
technology. 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.

Estimated provisions for environmental rehabilitation, comprising pollution control rehabilitation and mine closure, are

based on our environmental management plans in compliance with current technological, environmental and regulatory requirements.
An average discount rate of 8.3%, average inflation rate of 6.0% and expected life of mines according to the life-of-mine plans were
utilized in the calculation of the estimated net present value of the rehabilitation liability (fiscal 2013: average discount rate of 7.6%,
average inflation rate of 5.4% and fiscal 2012: average discount rate of 7.3%, average inflation rate of 5.4%). During fiscal 2014
there was a net increase in the provision of R10.2 million which was capitalized to property, plant and equipment for Ergo, and a
reduction amounting to R14.2 million for rehabilitation costs incurred. During fiscal 2013 there was a net decrease in the provision of
R6.4 million which was credited to property, plant and equipment for Ergo, and a reduction amounting to R22.5 million for
rehabilitation costs incurred. During fiscal 2012 there was a net increase in the provision of R13.4 million which was capitalized to
property, plant and equipment for Ergo, representing an increase in its respective footprints and a reduction amounting to R19.8
million for rehabilitation costs incurred). As a result of the disposal of Blyvoor the provision for environmental rehabilitation
decreased by R46.0 million in fiscal 2012.

The restoration provision for environmental rehabilitation represents the costs of restoring site damage after the start of

production. Increases in the provision are recognized in profit or loss as a cost of production. Gross restoration liabilities are
estimated at the present value of the expenditures expected to settle the obligation.

A benefit to profit or loss amounting to R86.6 million was recognised resulting from a decrease in the estimated cost to

rehabilitate. This is based on the implementation of a different technique to vegetate the Crown complex as well as the increased use
of “grey water” in rehabilitation. An updated survey and work performed during the year resulted in a decrease of the area to be
vegetated. Charges to profit or loss for the environmental rehabilitation of R15.3 million and R59.2 million were raised in fiscal 2013
and 2012 respectively. Unwinding of the provisions amounting to R38.0 million, R33.5 million and R7.3 million were recorded in
fiscal 2014, 2013 and 2012, respectively.

In South Africa, annual contributions are made to dedicated Rehabilitation Trust Funds and investments in funds held in

insurance instruments, which are to be used to fund the estimated cost of rehabilitation during and at the end of the life of the relevant
mine.

Financial instruments

Financial instruments recognized on the statement of financial position include investments, trade and other receivables,

cash and cash equivalents, long- and short-term interest-bearing borrowings, trade and other payables, and bank overdrafts.
Financial instruments are initially recognized at fair value and include any directly attributable transaction costs, except those
financial instruments measured at fair value through profit or loss.

If the value of the financial instrument cannot be obtained from an active market, we have established fair value by using

valuation techniques. These include the use of recent arm’s length transactions, reference to other instruments that are
substantially the same, discounted cash flow analysis and option pricing models, refined to reflect the issuer’s specific
circumstances. Listed shares are measured at fair value based on the market close price at the reporting date and applying a
discount factor for liquidity constraints pertaining to the relevant listed shares.

Following the adoption of a new Enterprise Resource Planning (ERP) system in 2013, Rand Refinery experienced

implementation difficulties which led to a difference between the actual inventory and the accounting records of approximately 87
000oz of gold. Due to the uncertainty around Rand Refinery’s inventory and the time it is taking to resolve this matter, the group
has assumed that the 87 000oz gold shortfall will not be recovered. The shareholders of Rand Refinery have offered financial
support in the form of an irrevocable subordinated loan of up to R1.2 billion (the “facility”). Rand Refinery can only draw on the
Facility when there is confirmation that an actual gold shortfall exists. For the time being, DRDGOLD declined the option to
provide funding on a pro-rate basis with other shareholders. Should it elect not provide such funding, its shareholding will be
diluted, if other shareholders provide funding. Management therefore estimated the fair value of the investment in Rand Refinery
shares as zero. The accumulated revaluations recognised in Other Comprehensive Income (R53.2 million) has been derecognised
and the initial cost of the investment (R40.2 million) has been recognised as an impairment in profit or loss for the year.

Operating results

Comparison of financial performance for the fiscal year ended June 30, 2014 with fiscal year ended June 30, 2013

Revenue

The following table illustrates the year-on-year change in revenue by evaluating the contribution of continuing and

discontinued operations to the total change on a group basis for fiscal 2014 in comparison to fiscal 2013:

Impact of change in volume

R’000

Total

revenue

2013

Disposals

Internal

growth/

(decline)

Impact of

change in

price

Net change

Total

revenue

2014

Ergo

............................................

2,076,496

(161,244)

(105,817)

(267,062)

1,809,434

Total Operations .......................

2,076,496

(161,244)

(105,817)

(267,062)

1,809,434

Revenue for fiscal 2014 decreased by R267.1 million, or 12.8%, to R1,809.4 million. The decrease in revenue is mainly

due to a 6% decrease in the average rand gold price received amounting to R432,775 per kilogram and a 9% decrease in gold
produced from continuing operations.

Net operating costs

The following table illustrates the year-on-year change in net operating costs by evaluating the contribution of continuing

and discontinued operations to the total change on a group basis for fiscal 2014 in comparison to fiscal 2013:

Impact of change in volume

R’000

Net

operating

costs

2013

Disposals

Internal

growth/

(decline)

Impact of

change in

costs

Net change

Net

operating

costs

2014

Ergo

............................................

1,397,177

(128,578)

280,851

152,273

1,549,400

Total ............................................

1,397,177

(128,578)

280,851

152,273

1,549,400

Operating costs are linked directly to the level of production of a specific fiscal year. Operating costs in fiscal 2014

increased by 11% to R1,549.4 million compared to operating costs of R1,397.2 million in fiscal 2013 due to lower gold
production and above inflation increases in prices of key consumables, labor and electricity.

Due to the restructuring on July 1, 2012 ErgoGold, Ergo Mining, Crown and the surface retreatment operation of ERPM have all been

transferred into Ergo Mining. However, this did not result in a change in the Ergo operating segment.

The following table lists the major components of operating costs for each of the fiscal years set forth below:

Years ended June 30,

Costs

2014

2013

Labor .................................................................................................................................................

17%

Specialized service providers ..........................................................................................................

15%

19%

Consumables and other ...................................................................................................................

50%

46%

Electricity and water ........................................................................................................................

18%

Rehabilitation provision and amounts contributed to environmental trust funds

As of June 30, 2014, we estimate our total rehabilitation provision, being the discounted estimate of future costs, to be

R471.7 million as compared to R524.3 million at June 30, 2013. The decrease in the provision for environmental rehabilitation in
fiscal 2014 was due a R14.2 million reduction in the provision resulting from rehabilitation work conducted during fiscal 2014,
changes in discount and inflation rate assumptions as well as changes in the planned rehabilitation techniques to be applied
supplemented by the increased use of "grey water" in rehabilitation. These decreases were offset by additional environmental damage
incurred due to continuing operations. In fiscal 2014, a benefit of R86.6 million (fiscal 2013: expense of R15.3 million) and the
unwinding of the provision of R38.0 million (fiscal 2013: R33.5 million) was recorded in profit / loss.

A total of R90.9 million was invested in our various environmental trust funds as at the end of fiscal 2014, as compared

to R86.4 million for fiscal 2013. The increase is attributable to R4.6 million interest received on these funds during fiscal 2014. A
total of R93.7 million are invested in funds held in insurance instruments to provide financial guarantees provided to the DMR
through an insurance cell captive company, the Guardrisk Cell Captive. As at June 30, 2014 guarantees amounting to R305.7
million were issued to the DMR. Subsequent to June 30, 2014 an additional guarantee amounting to R98.2 million was issued to the
DMR. 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, the proceeds on the disposal
of remaining assets and gold from plant clean-up.

Depreciation

Depreciation charges were R160.0 million for fiscal 2014 compared to R143.8 million for fiscal 2013. The increase was

mainly attributable to the completion of the FFG project during December 2013 after which date depreciation commenced.

Retrenchment costs

Retrenchment costs increased to R6.8 million in fiscal 2014 from R0.6 million in fiscal 2013. These costs were incurred

due to the restructure of the executive and senior management with a view to right-sizing the corporate footprint and reducing
costs.

Impairments

In fiscal 2014, an impairment amounting to R56.6 million was recognized. The impairment consisted of R12.4 million

against property, plant and equipment at a specific asset level, R46.9 million against our investment in Rand Refinery and Village
Main Reef. These were offset by a reversal of impairment of R2.7 million on equity accounted investments.

Administration expenses and general costs

The administration expenses and general costs increased in fiscal 2014 to R78.1 million from R64.5 million in fiscal

2013, an increase of R13.6 million. In fiscal 2014 administration expenses and general costs included a non-recurring gain on
disposal of property amounting to R0.9 million (2013: R19.2 million).

Finance income

Finance income decreased from R66.0 million in fiscal 2013 to R28.0 million in fiscal 2014. The decrease was mainly

due to dividends received from available-for-sale financial assets in fiscal 2013, amounting to R32.5 million and a decrease of
R8.3 million in interest received on lower cash balances.

Finance expenses

Finance expenses increased from R42.0 million in fiscal 2013 to R52.3 million in fiscal 2014. The increase was mainly

attributable to the unwinding of the rehabilitation provision amounting to R38.0 million in fiscal 2014 compared to R33.5 million
in fiscal 2013 and a decrease in borrowing costs capitalized from R10.9 million in fiscal 2013 to R3.5 million in fiscal 2014. In
addition, the interest paid on the Domestic Medium Term Note Program (see Item 5B. “Liquidity and Capital Resources –
Borrowings and Funding”) decreased with the decrease in borrowings from R167.6 million in fiscal 2013 to R148.7 million in
fiscal 2014.

Share of losses of equity accounted investments

The R0.3 million share of losses of equity accounted investments relate to impairments of the remaining current assets

recognised at Chizim Gold level. On June 30, 2013 Chizim Gold (Pvt) Limited stopped conducting feasibility studies on certain
exploration tenements in Zimbabwe. On this date the group impaired its non-current exploration assets in full through its share of
the equity accounted losses of the investee amounting to R50.1 million.

Income tax

The net tax charge of R17.6 million for fiscal 2014 consisted of current tax of R6.4 million, mostly relating to non-

mining income earned by the group, and a deferred tax charge of R11.1 million, mostly relating to mining income despite the loss
before tax due to significant non-deductable expenditure in the form of impairments recognised as well as losses incurred for
which no deferred tax can be recognised.

The net tax charge of R60.9 million for fiscal 2013 consisted of a current tax charge of R4.2 million, mostly relating to

non-mining income earned by the group, and a deferred tax charge of R56.7 million relating to mining income which was
somewhat offset by significant non-deductable expenditure in the form of impairments recognised as well as losses incurred for
which no deferred tax can be recognised.

Comparison of financial performance for the fiscal year ended June 30, 2013 with fiscal year ended June 30, 2012

Revenue

The following table illustrates the year-on-year change in revenue by evaluating the contribution of each segment to the

total change on a group basis for fiscal 2013 in comparison to fiscal 2012:

Impact of change in volume

R’000

Total

revenue

2012

Disposals

Internal

growth/

(decline)

Impact of

change in

price

Net change

Total

revenue

2013

Ergo

............................................

1,764,191

138,761

173,544

312,305

2,076,496

Blyvoor

......................................

1,240,073

(1,240,073)

Total Operations .......................

3,004,264

(1,240,073)

138,761

173,544

(927,768)

2,076,496

Revenue for fiscal 2013 decreased by R927.8 million, or 31%, to R2,076.5 million, mainly due to the disposal of Blyvoor

on June 1, 2012. The increase in revenue for Ergo was largely due to a 9% increase in the average rand gold price received
amounting to R458,084 per kilogram and an 8% increase in gold produced from continuing operations.

Net operating costs

The following table illustrates the year-on-year change in net operating costs by evaluating the contribution of each

segment to the total change on a group basis for fiscal 2013 in comparison to fiscal 2012:

Impact of change in volume

R’000

Net

operating

costs

2012

Disposals

Internal

growth/

(decline)

Impact of

change in

costs

Net change

Net

operating

costs

2013

Ergo

............................................

1,141,973

89,821

165,383

255,204

1,397,177

Blyvoor

......................................

1,046,914

(1,046,914)

Total ............................................

2,188,887

(1,046,914)

89,821

165,383

(791,710)

1,397,177

Due to the restructuring on July 1, 2012 ErgoGold, Ergo Mining, Crown and the surface retreatment operation of ERPM have all been

transferred into Ergo Mining. However, this did not result in a change in the Ergo operating segment.

Blyvoor was sold on June 1, 2012.

Operating costs are linked directly to the level of production of a specific fiscal year. Operating costs in fiscal 2013

decreased by 36% to R1,397.2 million compared to operating costs of R2,188.9 million in fiscal 2012. This decrease was mainly
as a result of the disposal of Blyvoor on June 1, 2012.

The following table lists the major components of operating costs for each of the years set forth below:

Years ended June 30,

Costs

2013

2012

Labor .................................................................................................................................................

17%

32%

Specialized service providers ..........................................................................................................

19%

12%

Consumables and other ...................................................................................................................

46%

37%

Electricity and water ........................................................................................................................

18%

19%

Rehabilitation provision and amounts contributed to environmental trust funds

As of June 30, 2013, we estimate our total rehabilitation provision, being the discounted estimate of future costs, to be

R524.3 million as compared to R504.3 million at June 30, 2012. The increase in the provision for environmental rehabilitation in
fiscal 2013 was due to changes in discount and inflation rate assumptions, changes in estimates resulting from changes to the life-of-
mines and additional environmental damage incurred which was off-set by a R22.5 million reduction in the provision resulting from
rehabilitation work conducted during fiscal 2013. In fiscal 2013, an expense of R15.3 million (fiscal 2012: R59.2 million) and the
unwinding of the provision of R33.5 million (fiscal 2012: R7.3 million) was recorded in profit or loss.

A total of R86.4 million was invested in our various environmental trust funds as at the end of fiscal 2013, as compared

to R104.5 million for fiscal 2012. The decrease is attributable to the derecognition of the DRDGOLD rehabilitation trust fund,
amounting to R25.6 million, due to the relinquishment of the fund to the buyer of the relating mining rights over the Durban
Roodepoort Deep mine area. The decrease was partially offset by a R5.6 million increase for interest received on these funds
during fiscal 2013. A total of R88.6 million was invested in funds held in insurance instruments to provide financial guarantees to
the DMR through an insurance cell captive company, the Guardrisk Cell Captive. As at June 30, 2013 guarantees amounting to
R305.7 million were issued to the DMR. 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, the proceeds on the disposal of remaining assets and gold from plant clean-up.

Depreciation

Depreciation charges were R143.8 million for fiscal 2013 compared to R120.9 million for fiscal 2012. The increase was

mainly attributable to the completion of the Crown/Ergo pipeline project during May 2012, which was depreciated for a full year
in fiscal 2013.

Retrenchment costs

Retrenchment costs decreased to R0.6 million in fiscal 2013 from R43.7 million in fiscal 2012. In fiscal 2012, these costs

related to the closure of the Number 4 and 6 shafts at Blyvoor, resulting in the retrenchment of 1,542 employees.

Impairments

In fiscal 2013, an impairment amounting to R187.9 million was recognized. The impairment consisted of R61.0 million

against property, plant and equipment at a specific asset level, R101.3 million against our investment in Village and R25.6 million
for the derecognition of the DRDGOLD rehabilitation trust fund.

Administration expenses and general costs

The administration expenses and general costs decreased in fiscal 2013 to R64.5 million from R133.6 million in fiscal

2012, a decrease of R69.1 million. In fiscal 2013, administration expenses and general costs included a non-recurring gain on
disposal of property amounting to R19.3million. In fiscal 2012, administration expenses and general costs included a non-
recurring loss of approximately R9.6 million relating to the loss on the sale of property, plant and equipment.

Finance income

Finance income increased from R33.5 million in fiscal 2012 to R66.0 million in fiscal 2013. The increase was mainly due

to dividends received from available-for-sale financial assets in fiscal 2013, amounting to R32.5 million.

Finance expenses

Finance expenses increased from R17.7 million in fiscal 2012 to R42.0 million in fiscal 2013. The increase was mainly

attributable to the unwinding of the rehabilitation provision amounting to R33.5 million in fiscal 2013 compared to R7.3 million
in fiscal 2012. In addition, the interest paid on the Domestic Medium Term Note Program (see Item 5B. “Liquidity and Capital
Resources – Borrowings and Funding”) increased with the increase in borrowings from R30.7 million in fiscal 2012 to R167.6
million in fiscal 2013.

Share of losses of equity accounted investments

On June 30, 2013 Chizim Gold (Pvt) Limited stopped conducting feasibility studies on certain exploration tenements in

Zimbabwe. On this date the group recognised the impairment of the non-current exploration assets through its share of the equity
accounted losses of the investee amounting to R50.1 million.

Income tax

The net tax charge of R60.9 million for fiscal 2013 consisted of a current tax charge of R4.2 million, mostly relating to

non-mining income earned by the group, and a deferred tax charge of R56.7 million relating to mining income which was
somewhat offset by the decrease in deferred tax liability resulting from the impairments recognised and non-deductible expenses.

This compares to a net tax benefit of R1.8 million for fiscal 2012 consisting of a current taxation charge of R0.2 million,

a deferred tax benefit of R6.5 million and secondary tax on companies amounting to R4.5 million. The year-on-year increase in
the net tax charge was mainly due to the increased profitability of Ergo.

5B. LIQUIDITY AND CAPITAL RESOURCES

Cash flows from operating activities

Net cash of R80.7 million (fiscal 2013: R502.3 million and fiscal 2012: R621.2 million) was generated by operating

activities for fiscal 2014. During fiscal 2014, the net working capital movement represented an outflow of cash of R39.4 million,
compared to an outflow of R55.8 million in fiscal 2013 and an inflow of R75.4 million in fiscal 2012. Cash generated from operating
activities decreased largely due to the increase in cash operating costs per kilogram due to lower gold production and above inflation
increases in prices of key consumables, labor and electricity. Cash generated from operating activities for fiscal 2013 decreased
largely due to the disposal of Blyvoor on June 1, 2012, which represented R137.1 million of the cash generated from operating
activities in fiscal 2012.

Cash flows from investing activities

Net cash utilized by investing activities amounted to R171.8 million in fiscal 2014 compared to R429.4 million in fiscal

2013 and R406.4 million in fiscal 2012.

In fiscal 2014, cash utilized by investing activities mainly consisted of R158.6 million in additions to property, plant and

equipment and R14.2 million spent on environmental rehabilitation payments, offset by R1.0 million proceeds on the disposal of
property, plant and equipment.

Additions to property, plant and equipment was predominantly on the Flotation and fine-grind project, Ore Reserve

development, new infrastructure and new mining equipment at our operations. Significant capital projects for Ergo during fiscal 2014
included:

R89.5 million on the flotation and fine-grind project, R32.4 million on Reclamation Site 4A6, R6.2 million on
rehabilitation of the Brakpan Tailings Dam and R26.7 million on other capital items.

In fiscal 2013, cash utilized by investing activities mainly consisted of R368.5 million in additions to property, plant and

equipment, R58.3 million in acquisition of investments (mainly due to R 27.4 million contributions to rehabilitation obligation funds,
R 26.9 million additions to unlisted investments), R13.9 million advance to equity accounted investments and R22.5 million spent on
environmental rehabilitation payments, offset by R32.0 million proceeds on the disposal of property, plant and equipment and R 1.8
million on the disposal of investments.

Additions to property, plant and equipment was predominantly on the Flotation and fine-grind project, Ore Reserve

development, new infrastructure and new mining equipment at our operations. Significant capital projects for fiscal 2013 included:

Ergo spent R261.5 million on the flotation and fine-grind project, R11.7 million on the Brakpan TSF, R20.5
million on the Cason high grade plant, R30.4 million on the Angelo Pan reclamation and pipeline, R26.3 million
on infrastructure upgrades equipment, and R5.5 million on other equipment.

In fiscal 2012, cash utilized by investing activities mainly consisted of R319.0 million in additions to property, plant and

equipment, R55.5 million in acquisitions of investments(R 45.9 million contributions to rehabilitation obligation funds and R 9.6
million additions to unlisted investments), R14.5 million advance to equity accounted investments and R19.8 million spent on

environmental rehabilitation payments, offset by R12.5 million proceeds on the disposal of property, plant and equipment. A cash
outflow on disposal of subsidiaries of R9.6 million was also realised.

Additions to property, plant and equipment was predominantly on the Crown/Ergo pipeline project, Ore Reserve

development, new infrastructure and new mining equipment at our operations. Significant capital projects for fiscal 2012 included:

Ergo spent R33.9 million on the Crown/Ergo pipeline project, R50.7 million on the extension of the Brakpan TSF,
R15.5 million on the refurbishment of the Ergo plant, R38.5 million on the new flotation and fine-grind project,
R49.0 million on infrastructure upgrades and equipment, R14.2 million on the tailings facilities and R16.1 million
to replace old equipment and acquire new equipment.

Blyvoor for opening up and development amounting to R50.3 million, equipment replacement amounting to R23.3
million and R9.3 million for other equipment and the tailings facilities.

We anticipate decreasing our additions to property, plant and equipment in fiscal 2015 by about 36% compared to fiscal

2014. We expect to incur R102.5 million on additions to property, plant and equipment for mining equipment, upgrading of
current metallurgical plants and tailings facilities as follows:

· Ergo – R100.5 million; and
· Other – R2.0 million.

Cash flows from financing activities

Net cash outflow from financing activities was R76.6 million in fiscal 2014 compared to a net cash inflow of R5.7 million in

fiscal 2013 and a net cash outflow of R168.6 million in fiscal 2012.

During fiscal 2014, the net cash outflow consisted of R20.0 million repayments of loans and borrowings, R2.7 million share

option buy-out and a dividend payment of R53.1 million.

During fiscal 2013, the net cash inflow consisted of R163.3 million raised through a Domestic Medium Term Note Program,

which was offset by R30.7 million repayments of loans and borrowings, R24.1 million share option buy-out and a dividend payment
of R103.1 million.

During fiscal 2012, the net cash outflow consisted of R96.2 million for repayments of loans and borrowings, R58.2 million

for the acquisition of treasury shares and a dividend payment of R28.9 million, which were offset by proceeds of R13.5 million on
disposal of treasury shares.

Cash and cash equivalents

Cash and cash equivalents as at June 30, 2014 amounted to R208.9 million compared to R376.6 million at the end of fiscal

2013 and R298.0 million at the end of fiscal 2012. This included $1.9 million as at June 30, 2014, $0.6 million as at June 30, 2013
and $1.1 million as at June 30, 2012 which were all sold forward resulting in zero exposure to currency volatility at these dates. The
remainder of the cash and cash equivalent balances were denominated in South African rand. Surplus cash is held in low-risk, high
interest bearing products with various large financial institutions.

Borrowings and funding

Our external sources of capital include the issuance of debt, bank borrowings, loan notes and the issuance of equity

securities, which include the following:

On October 1, 2010 EMO established a R500 million Domestic Medium Term Note Program, or DMTN Program, under

which it could from time to time issue notes. On October 1, 2010, EMO issued R108 million in notes under the DMTN Program
and maturity dates of 12 and 24 months from the date of issue and interest set at the three month JIBAR rate plus a margin ranging
from 4% to 5% per annum. The loan notes with a 12 month maturity, amounting to R78.0 million, were repaid on October 3,
2011. The remaining loan notes with a 24 month maturity, amounting to R30.0 million, were repaid on October 3, 2012. The
EMO DMTN Program was cancelled and has been replaced by the DRDGOLD DMTN Program below.

On July 2, 2012, DRDGOLD established a R2.0 billion DMTN Program under which it may from time to time issue

notes. This DMTN Program replaces the DMTN Program established by EMO on October 1, 2010. In July and September 2012,
DRDGOLD issued R165 million in notes under the DMTN Program and maturity dates of 12, 24 and 36 months from the date of
issue and bearing interest at the three month JIBAR rate plus a margin ranging from 4% to 5% per annum. The loan notes with a
12 and 24 month maturity, amounting to R20.0 million and R69.5 million respectively, were repaid on October 3, 2013 and July
3, 2014 respectively. The remaining loan notes with a 36 month maturity, amounting to R75.5 million, are repayable on July 3,
2015.

Anticipated funding requirements and sources

At June 30, 2014, we had cash and cash equivalents of R208.9 million, and positive working capital (defined as current

assets less current liabilities) of R162.9 million, compared to cash and cash equivalents of R376.6 million and positive working
capital of R361.7 million at June 30, 2013 and cash and cash equivalents of R298.0 million and positive working capital of
R209.7 million at June 30, 2012.

At September 30, 2014, our cash and cash equivalents were R204.3 million.

Our management believes that existing cash resources, net cash generated from operations and the availability of

negotiated funding facilities will be sufficient to meet our anticipated commitments for fiscal 2015 as described above.

Our estimated working capital, capital expenditure and other funding commitments, as well as our sources of liquidity,

would be adversely affected if:

· our operations fail to generate forecasted net cash flows from operations;
· there is an adverse variation in the price of gold or foreign currency exchange rates in relation to the US dollar,
particularly with respect to the rand; or
· our operating results or financial condition are adversely affected by the uncertainties and variables facing our business
discussed under Item 5A.: “Operating Results” or the risk factors described in Item 3D.: “Risk Factors.”

In such circumstances, we could have insufficient capital to meet our current obligations in the normal course of

business, which would have an adverse impact on our financial position and our ability to continue operating as a going concern.
We would need to reassess our operations, consider further restructuring and/or obtain additional debt or equity funding. There
can be no assurance that we will obtain this additional or any other funding on acceptable terms or at all.

5C. RESEARCH AND DEVELOPMENT, PATENTS AND LICENSES, ETC.

DRDGOLD has a dedicated team that looks at ways and means of improving recoveries. Following their work on the

responses of gold encapsulated in sulphides, we constructed the fine grind and flotation circuit at a total cost of R 389 million. The
team remains active with an ongoing focus on improving extraction efficiencies, including the test work associated with the
recommencement of the FFG circuit in August 2014.

We have no registered patents or licenses.

5D. TREND INFORMATION

During the first quarter of fiscal 2015, we produced 37,005 ounces at average cash cost of R375,044 per kilogram from our

operations. Gold production from our operations for the second quarter of fiscal 2015 is expected to be in line with the first quarter
results. Cash operating costs for the second quarter of fiscal 2015 are expected to be slightly lower due to winter tariffs for electricity
applying for the first two months of the first quarter of fiscal 2015 only. Normal tariffs apply for the whole of the second quarter.

For the full year fiscal 2015, we are expecting gold production from our operations of 150,000 to 160,000 ounces at cash

operating costs of approximately R361,000 per kilogram, based on an exchange rate assumption of approximately $1.00/R11.04. Our
ability to meet the full year’s production target could be impacted by, amongst other factors, lower grades, failure to achieve the
targets set at Ergo and failure to timely restart full production at the flotation and fine-grind project. We are also subject to cost
pressures due to above inflation increases in labor costs, electricity and water prices; increases in crude oil, steel, unforeseen changes
in ore grades and recoveries; unexpected changes in the quality or quantity of reserves; technical production issues; environmental
and industrial accidents; gold theft; environmental factors; and pollution, which could adversely impact the cash operating costs for
fiscal 2015.

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 OBLIGATIONS

Estimated and actual payments due by period

Total

Less than

1 year

Between

1-3 years

Between

3-5 years

More than 5

years

R’000

Loan notes (including interest) .................................................

156,863

79,358

77,505

Purchase obligations – contracted capital expenditure

.........

3,255

Environmental rehabilitation, reclamation and closure
costs

...........................................................................................

471,733

12,944

90,795

367,994

Operating leases .........................................................................

3,890

2,110

1,780

Finance leases ............................................................................

36,388

3,978

10,710

21,700

Total contractual cash obligations ........................................

672,129

101,645

89,995

112,495

367,994

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, 2014 our board

consisted of seven directors. As of June 30, 2013 and as of June 30, 2012, our board consisted of six directors.

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.

The address of each of our Executive Directors and Non-Executive Directors is the address of our principal executive

offices.

Executive Directors

Daniël Johannes Pretorius (47) Chief Executive Officer. Mr. D.J. Pretorius was appointed as Chief Executive Officer

Designate on August 21, 2008. On January 1, 2009 he succeeded Mr. John William Cornelius Sayers as Chief Executive Officer. Mr.
Pretorius holds a B Proc, LLB degree and was appointed Group Legal counsel for the Company in September 2004, he was
appointed as Chief Executive Officer of Ergo Mining Operations in July 2006. He has 21 years of experience in the mining industry.

Craig Clinton Barnes (44) Chief Financial Officer. Mr. C.C. Barnes joined the Company in August 2004 as Group Financial

Accountant. A Chartered Accountant, he has a B Com degree from the University of the Witwatersrand, or Wits University, and a B
Com Honors degree from the University of South Africa, or Unisa. Prior to joining the Company, he was head of financial reporting
for Liberty Group Limited and he has over 20 years financial experience. He was appointed as Chief Financial Officer of Ergo
Mining Operations in July 2006 and as Chief Financial Officer of DRDGOLD in May 2008. Mr. C.C. Barnes has resigned as
executive director and Chief Financial Officer with effect December 31, 2013.

Francois van der Westhuizen (34) Chief Financial Officer and an executive director from January 1, 2014. Mr. F.D. van der

Westhuizen joined DRDGOLD in May 2009 as group financial accountant. His most recent responsibilities have included local and
foreign financial reporting and the group treasury function. He is also head of the tax department. A qualified chartered accountant
(South Africa), Mr F D van der Westhuizen has a BCom (Hons) from the University of Pretoria and a Magister Commercii
(specializing in taxation). He has an Associate Chartered Management Accountant qualification from the Chartered Institute of
Management Accountants (United Kingdom). Mr. F D van der Westhuizen's appointment as Chief Financial Officer was terminated
by mutual agreement and he resigned as executive director with effect July 18, 2014.

Represents planned capital expenditure for which contractual obligations exist.

Operations of 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 17 “Provision for environmental rehabilitation, reclamation and
closure costs” under Item 18.: “Financial Statements”.

Anthon Tobias Meyer (60) Acting Chief Financial Officer and an executive director from July 29, 2014. He has more than

25 years of experience in the fields of auditing, accounting and strategic financial management and is a member of the SA Institute of
Chartered Accountants and the Public Accountants and Auditors Board. Anthon has approximately 10 years of experience in the
mining industry and has served on the boards of listed and public companies for more than 15 years.

Non-Executive Directors

Geoffrey Charles Campbell (53). Mr. G.C. Campbell was appointed as Non-Executive Director in 2002, as a Senior

Independent Non-Executive Director in December 2003 and as Non-Executive Chairman in October 2005. A qualified geologist, he
has worked on gold mines in Wales and Canada. He then spent 15 years first as a stockbroker and afterwards as a fund manager,
during which time he managed the Merrill Lynch Investment Manager’s Gold and General Fund, one of the largest gold mining
investment funds. He was also Research Director for Merrill Lynch Investment Managers. Mr. G.C. Campbell is also a director of
Oxford Abstracts.

Robert Peter Hume (74). Mr. R.P. Hume was appointed as a Non-Executive Director in 2001. He has 44 years experience in

the field of auditing, including 18 years as a partner in the East London (South Africa) office of KPMG. Since retiring from KPMG in
1999, he has been an Investment Manager at Nvest Securities Proprietary Limited (formerly Sasfin Frankel Pollak) in East London.
Mr. R.P. Hume will retire at the forthcoming annual general meeting. He has not offered himself for re-election.

James Turk (67). Mr. J. Turk was appointed a Non-Executive Director in October 2004. He is the founder and a director of

GoldMoney Network Limited, formerly G.M. Network Limited (also known as GoldMoney.com), the operator of a digital gold
currency payment system. Since graduating from George Washington University with a BA degree in International Economics in
1969, he has specialized in international banking, finance and investments. After starting his career with Chase Manhattan Bank (now
J.P. Morgan Chase) he joined RTB Inc., a private investment and trading company of a prominent precious metals trader in 1980. He
moved to the United Arab Emirates in 1983 as Manager of the Commodity Department of the Abu Dhabi Investment Authority.
Since resigning from this position in 1987, he has written frequently on money and banking.

Edmund Jeneker (52). Mr. E.A. Jeneker (IEDP (Wits), M.Inst.D., SAIPA,) was appointed a Non-Executive Director on

November 1, 2007. He trained as an accountant and has over 22 years’ experience in finance, taxation, business strategy and
general management at Grant Thornton, SwissReSA, World Bank Competitiveness Fund and Deloitte. He is active in community
development and serves as a member of the Provincial Development Commission of the Western Cape Provincial Government.
He currently holds the position of Managing Director – Absa AllPay Consolidated Investment Holdings at Absa Group Limited.

Johan Holtzhausen (68). Mr. J.A. Holtzhausen was appointed an independent non-executive director of the company on

April 25, 2014. He has more than 42 years’ experience in the accounting profession, having served as a senior partner at KPMG, 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 of America. His clients included
major corporations listed in South Africa, Canada, the United Kingdom, Australia and the United States of America.

Mr Holtzhausen currently serves as an independent director of the Tourism Enterprise Partnership and chairs the audit and

risk committee on a voluntary basis. This South African non-profit company is a leading small business development agency funded
by a public-private partnership. He chairs the audit and risk committee of Tshipi é Ntle Manganese Mining Proprietary Limited, an
emerging South African manganese miner. He is a non-executive director of Caledonia Mining Corporation, a Canadian corporation
listed in the United States of America, Canada and the United Kingdom, and he chairs its audit and risk committee.

Senior Management

Wilhelm Jacobus Schoeman (40) Operations Director: Ergo. Mr. W.J. Schoeman (Dip Analytical Chemistry, BTech

Analytical Chemistry) joined DRDGOLD on October 1, 2011 to focus on expanding the group’s surface retreatment business and
extracting maximum value from existing resources. Mr Schoeman previously held the position Executive Officer: Business
Development. In July 2014 this role and the role of COO were phased out and replaced with the position of Operations Director: Ergo
Mining Operations Proprietary Limited, and Mr Schoeman was appointed to this new position.

Themba John Gwebu (50) Executive Officer: Legal, Compliance and Company Secretary. Mr. T.J. Gwebu (B Iuris, LLB,

LLM) is a qualified attorney who worked as a magistrate prior to joining the Company in April 2004 as Assistant Legal Advisor. He
was appointed to the position of Company Secretary in April 2005 and Executive Officer: Legal, Compliance and Company
Secretary on January 1, 2007.

Henry Gouws (45) Managing Director: Ergo. Mr. H. Gouws graduated from Technicon Witwatersrand and obtained a

National Higher Diploma in Extraction Metallurgy in 1991. He completed a Management Development Programme ("MDP") in
2003 through Unisa School of Business Leadership. He was appointed Operations Manager of Crown in January 2006 and General
Manager in July 2006. He was appointed to this current position with effect from October 1, 2011. He has 27 years experience in the
mining industry.

Mark Burrell (52) Financial Director: Ergo. Mr. M. Burrell holds a BComm Accounting degree and completed a MDP. Mr.

M. Burrell 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 Mining in January 2012 and has 16 years experience in
the mining sector.

Charles Methley Symons (60) Chairman: Oversight Committee: Ergo Mining Operations Proprietary Limited.

Mr. C.M. Symons commenced his career in the mining industry in February 1977 and joined Crown in January 1986 where he was
appointed General Manager in 1995. He holds a Masters degree in Business Leadership and a B Comm degree from Unisa, and he
also has a National Diploma in Extractive Metallurgy. He was appointed Executive Officer: Surface Operations on January 1, 2008,
Executive Officer: Operations on May 11, 2010 and Chief Operating Officer with effect from October 1, 2011. Following the
restructuring of senior management in July 2014, Charles Symons assumed the role of Chairman: Oversight Committee: Ergo Mining
Operations Proprietary Limited.

Reneiloe Masemene (33) Group Legal Counsel. Ms R Masemene (LLB, LLM) is a qualified attorney who joined the

Company in January 2009 as Legal Advisor. She was appointed to the position of Senior Legal Advisor in October 2011 and
Prescribed Officer of Ergo on June 29, 2012. She was appointed to the position of group legal counsel in August 2014.

There are no family relationships between any of our executive officers or directors. 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.

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, 2014 was
R15.0 million. Non-Executive Directors receive the following fees:

· Base fee as Non-Executive Chairman of R1,309,923 per annum;
· Base fee as Non-Executive Directors of R582,188 per annum;
· Annual fee for Audit Committee Chairman of R29,110 (excluding fee received as a committee member);
· Annual fee for Audit Committee member of R29,110;
· Annual fee for Nominations Committee Chairman of R10,916 (excluding fee received as a committee member);
· Annual fee for Nominations Committee member of R10,916;
· Annual fee for the chairman of Remuneration Committee, Risk Committee, and Social and Ethics Committee of R 21,832
(excluding fee received as a committee member);
· Annual fee for members of Remuneration Committee, Risk Committee and Social and Ethics Committee of R21,832 each;
· Daily fee of R21,832 and hourly rate of R2,911;
· Half-day fee for participating by telephone in special board meetings; and
· The Chairman of the board to receive committee fees.

Non-executive directors’ fees are adjusted annually on the basis of the consumer price index.

The following table sets forth the compensation for our directors and prescribed officers for the year ended June 30, 2014:

Directors

Basic

salary/board

fees

(R'000)

Retirement fund

contributions/

bonus and

performance

related payments

(R'000)

Termination of

contract

payments

(R'000)

Share option

scheme gains

(R'000)

Total

(R'000)

Executive
D.J. Pretorius ............................

4,832

1,359

6,191

C.C. Barnes ..............................

2,119

1,386

255

3,760

F.D. van der Westhuizen .........

1,171

1,224

Subtotal ....................................

8,122

2,745

308

11,175

Non-Executive
G.C. Campbell .........................

1,514

R.P. Hume ................................

747

J. Turk .......................................

692

E.A. Jeneker .............................

792

J.A. Holtzhausen ......................

124

Subtotal ....................................

3,869

Prescribed officers

C.M. Symons

.........................

2,365

1,352

3,263

183

7,163

T.J. Gwebu……………........
W.J. Schoeman………….....

2,209
3,081

984

1,183

-
-

191
125

3,384
4,389

Subtotal ....................................

7,655

3,519

3,263

499

14,936

Total .........................................

19,646

6,264

3,263

807

29,980

See also Item 6E.: “Share Ownership” for details of share options held by directors.

Compensation of senior management

Our senior management comprises of executive directors, prescribed officers and executive officers. Under the JSE

Listing Rules we are not required to, and we do not otherwise, disclose compensation paid to individual senior managers other
than executive directors, non-executive directors and prescribed officers. However, the aggregate compensation paid to senior
management, excluding compensation paid to Executive Directors, in fiscal 2014 was R31.4 million (fiscal 2013: R26.4 million
and fiscal 2012: R22.4 million), representing eleven executive officers in fiscal 2014 and eleven executive officers in fiscal 2013.

Bonuses or incentives 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 bonus
of up to 50%, 75% or 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
by the Remuneration Committee in its discretion.

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 executive directors, Mr. D.J. Pretorius and Mr. A.T. Meyer, entered into agreements of employment with

us, on January 1, 2009 and July 29, 2014, respectively. These agreements regulate the employment relationship with Messrs. D.J.
Pretorius and A.T. Meyer.

Earned in respect of F13 KPI assessment

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.

Continues to render services to the group on a contract basis.

Earned in capacity of a director only

Exercised prior to appointment as director

Mr. D.J. Pretorius receives from us a remuneration package of R4.8 million per annum. Mr. D.J. Pretorius is 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 condition that DRDGOLD achieves certain key performance
indicators. He is not eligible to participate in the DRDGOLD Phantom Scheme. In addition, Mr. D.J. Pretorius’ employment
agreement requires DRDGOLD to issue to Mr. D.J. Pretorius 100,000 ordinary DRDGOLD shares as a mining right conversion
bonus. DRDGOLD issued 50,000 of these shares on the signing of the agreement, and the remaining tranche in November 2013
on the conversion of the mining rights of DRDGOLD’s South African operations.

Mr. C.C. Barnes received from us a remuneration package of R3.4 million per annum. Mr. C.C. Barnes was eligible

under his employment agreement, for an incentive bonus of up to 75% of his annual remuneration package in respect of one bonus
cycle per annum over the duration of his appointment, on condition that DRDGOLD achieves certain key performance indicators.
He was also be eligible to participate in the DRDGOLD Phantom Scheme.

Mr. F.D. van der Westhuizen received from us a remuneration package of R2.25 million per annum. Mr. F.D. van der

Westhuizen was eligible under his employment agreement, for an incentive bonus of up to 75% of his annual remuneration
package in respect of one bonus cycle per annum over the duration of his appointment, on condition that DRDGOLD achieves
certain key performance indicators. He will also be eligible to participate in the DRDGOLD Phantom Scheme.

Mr. A.T. Meyer receives a remuneration package of R165 000 per month. Mr. A.T. Meyer is not eligible under his

employment agreement, for any long or short term incentive bonuses including participation in the DRDGOLD Phantom Scheme.

Messrs. R.P. Hume, J. Turk, E.A. Jeneker and J.A. Holtzhausen each have service agreements which run for fixed periods

until September 30, 2014, October 31, 2014, October 31, 2014 and May 1, 2016 respectively. 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. Mr.
G.C. Campbell has a service agreement which continues 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 September 30, 2014, the board of directors comprises two Executive Directors (Mr. D.J. Pretorius and Mr. A.T.

Meyer), and five Non-Executive Directors (Messrs. G.C. Campbell, R.P. Hume, J. Turk, E.A. Jeneker and J.A. Holtzhausen). 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 III Report.

In accordance with the King III 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.T
Meyer is the Acting Chief Financial Officer. The board has established a 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 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.

During fiscal 2013 two of the Non-Executive Directors (Messrs. G.C. Campbell and R.P. Hume) had share options under

the Company’s share option scheme of which the remaining balance were bought out during the year by the Company through a
general share option buy-out. We do not believe that this compromised their independence. No new share options have been issued
to Non-Executive Directors since June 2005.

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 or three 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 Risk Committee, Audit Committee,
Remuneration Committee, Nominations Committee and Social and Ethics Committee which act as subcommittees to the board.
Each subcommittee is chaired by one of the Independent Non-Executive Directors, except for the Risk Committee which is
chaired by the Chief Executive Officer, each of which provides a formal report back to the board. Each subcommittee meets for
approximately half a day. Certain senior members of staff are invited to attend the subcommittee meetings.

The board sets the standards and values of the Company and much of this has been embodied in the Company’s Code of

Ethics and Conduct, a copy of which is available on our website at www.drdgold.com. The Code of Ethics and 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 under which employees can 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, 2014:

Director

Title

Year first
appointed

Term of

current

office

Unexpired

term of

current office

G.C. Campbell

Non-Executive Director

2002

2 years

16 months

D.J. Pretorius

Chief Executive Officer

2008

3 years

6 months

C.C. Barnes

Chief

Financial Officer

2008

F.D. van der Westhuizen

Chief Financial Officer

2014

2 years

18 months

R.P. Hume

Non-Executive Director

2001

2 years

3 months

E.A. Jeneker

Non-Executive Director

2007

2 years

16 months

J. Turk

Non-Executive Director

2004

2 years

4 months

J. Holtzhausen

Non-Executive Director

2014

2 years

22 months

¹Mr. D.J. Pretorius’s service contract has been renewed for another three years, effective January 1, 2012, in the Remuneration Committee meeting held in

February 2012. Three months notice applies thereafter.

Mr. C.C. Barnes’ service contract has been renewed for another three years, effective from May 5, 2011 in the Remuneration Committee meeting held in August 2011.

Mr. C.C. Barnes resigned as Chief Financial Officer with effect December 31, 2014.

Mr. F.D. van der Westhuizen's appointment as Chief Financial Officer was terminated by mutual agreement and he resigned as executive director with effect July 18,

2014.

Executive Committee

As at June 30, 2014, the Executive Committee consisted of Mr. D.J. Pretorius (Chairman), Mr. F.D. van der Westhuizen,

Mr. C.M. Symons, Mr W.J. Schoeman and Mr. T.J. Gwebu.

The Executive Committee meets on a weekly basis to review current operations, develop strategy and policy proposals for

consideration 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 Committee

The Remuneration Committee, which is comprised of Non-Executive Directors, has been appointed by the board of

directors. The committee meets quarterly, but may meet more often on an ad hoc basis if required. As at June 30, 2014 the
Remuneration Committee consisted of Mr. E.A. Jeneker (Chairman), Mr. G.C. Campbell, Mr. R.P. Hume and Mr J. Turk.

The Remuneration Committee is governed by its terms of reference and is responsible for approving the remuneration

policies of the Company, the terms and conditions of employment, and the eligibility and performance measures of the
DRDGOLD Phantom Share Scheme and DRDGOLD (1996) Share Option Scheme applicable to executive directors and senior
management.

The committee’s objective is to evaluate and recommend to the board competitive packages which will attract and retain

executives of the highest caliber and encourage and reward superior performance. The committee also aims to ensure that criteria
are in place to measure individual performance. The committee approves the performance-based bonuses of the executive
directors based on such criteria. The General Manager Corporate Services provides the committee with access to comparative
industry surveys, which assist in formulating remuneration policies. As and when required the committee may also engage the
services of independent consultants to evaluate and review remuneration policies and related issues and brief members on
pertinent issues.

The remuneration policy, relating to the remuneration of directors and senior executives, is based on a reward system

comprising four principal elements:

· Basic remuneration, as benchmarked against industry norms;
· Bonuses or incentives, which are measured against agreed outcomes or Key Performance Indicators, or KPIs;
· Short-term rewards for exceptional performance; and
· Long-term retention of key employees based on scarcity of skill and strategic value, using phantom share options granted
under the DRDGOLD Phantom Share Scheme.

A copy of the policy is available by application to the Company Secretary at the Company’s registered office.

Nominations Committee

The Nomination Committee, which is comprised of Non-Executive Directors, has been appointed by the board of

directors. The committee meets quarterly, but may meet more often on an ad hoc basis if required. As at June 30, 2014, the
Nominations and Remuneration Committee consisted of Mr. G.C. Campbell (Chairman), Mr. R.P. Hume and Mr. E.A. Jeneker.

The terms of reference were approved in August 2008. Its duties include:

· making recommendations to the board on the appointment of new Executive and Non-Executive directors, including
making recommendations on the composition of the board generally and the balance between Executive and Non-
Executive directors appointed to the board;
· regular reviewing of the board structure, size and composition and making recommendations to the board with regard to
any adjustments that are deemed necessary;
· identifying and nominating candidates for the approval of the board to fill board vacancies as and when they arise as well
as putting in place plans for succession, in particular for the Chairman and Chief Executive Officer; and
· making recommendations on directors who are retiring by rotation to be put forward for re-election.

Nomination and Remuneration Committee

As of September 30, 2014 the Nomination Committee and the Remuneration Committee have been combined into a

committee called the Nomination and Remuneration Committee. All the members of this committee are independent Non-Executive
Directors.

The Nominations and Remuneration Committee consisted of Mr. E.A. Jeneker (Chairman Remuneration), Mr. G.C.

Campbell (Chairman Nomination), Mr. R.P. Hume, Mr J. Turk and Mr. J.A. Holtzhausen.

The Nomination and Remuneration Committee, which is comprised of Non-Executive Directors, has been appointed by

the board of directors. The committee meets quarterly, but may meet more often on an ad hoc basis if required.

Audit Committee

As at June 30, 2014 the Audit Committee consisted of Mr. R.P. Hume (Chairman), Mr. J. Turk, Mr. J.A. Holtzhausen and

Mr. E.A. Jeneker.

The Audit Committee is comprised solely of Non-Executive Directors, all of whom are independent. See Item 16G.:

“Corporate Governance”. The primary responsibilities of the Audit Committee, as set out in the Audit Committee charter, is to
assist the board in carrying out its duties relating to accounting policies, internal financial control, financial reporting practices and
the preparation of accurate financial reporting and financial statements in compliance with all applicable legal requirements and
accounting standards. A copy of the charter is available by application to the Company Secretary at the Company’s registered
office.

The Audit Committee meets quarterly with the external auditors, the Company’s internal audit practitioner, the Chief

Financial Officer and the Internal Audit and Compliance Manager to review the audit plans of the internal auditors, to ascertain
the extent to which the scope of the internal audits can be relied upon to detect weaknesses in the internal controls and to review
the annual and interim financial statements prior to approval by the board. The Audit Committee reviews our annual results, the
effectiveness of our system of internal financial controls, internal audit procedures and legal and regulatory compliance. The
committee also reviews the scope of work carried out by our internal auditors and holds regular discussions with the external
auditors and internal auditors.

The committee appoints, re-appoints and removes the external auditors and approves the remuneration and terms of

engagement of the external auditors. The committee is required to pre-approve, and has pre-approved, non-audit services provided
by our external auditors. The Company’s external audit function is currently being undertaken by KPMG Inc.

The Company’s internal and external auditors have unrestricted access to the chairman of the Audit Committee and,

where necessary, to the Chairman of the board and Chief Executive Officer. All important findings arising from audit procedures
are brought to the attention of the committee and, if necessary, to the board.

Risk Committee

As at June 30, 2014, the Risk Committee consisted of Mr. D.J. Pretorius (Chairman), Mr. J. Turk, Mr. G.C. Campbell,

Mr. E.A. Jeneker, Mr. R.P. Hume and Mr F.D. van der Westhuizen.

Its overall objective is to assist the board in its duties relating to risk management and control responsibilities, assurance

issues, health, safety and environmental compliance, and the monitoring and reporting of all these matters. The Risk Committee
facilitates communication between the board, the Audit Committee, internal auditors and other parties engaged in risk
management activities. The terms of reference of the Risk Committee can be obtained by application to the Company Secretary at
the Company’s registered office.

The Risk Committee’s role is to ensure that:
· an effective risk management program is implemented and maintained;
· risk management awareness is promoted amongst all employees;
· risk programs (financing/insurance) adequately protect the Company against catastrophic risks;
· regular risk assessments are conducted;
· total cost of risk in the long term is reduced;
· the protection of the Group's assets is promoted throughout the Group;
· the health and safety and well being of all stakeholders is improved; and
· the Company’s activities are carried out in such a way so as to ensure the safety and health of employees.

The Risk Committee meets quarterly and reports to the board. Additional ad hoc meetings may be arranged as and when

required. Certain members of executive management are occasionally invited to attend Risk Committee meetings, such as the
Internal Audit and Compliance Manager, the Group Risk Manager, the Group Financial Manager, the Operational Managers and
the Group Legal Counsel.

The system to manage risk involves all significant business and operational risks which could undermine the

achievement of business objectives and undermine the preservation of shareholder value. The significant risks facing the Group
including those at operations have been identified and have been included in Item 3D.: “Risk factors.” Individuals have been
appointed to address each risk and the results thereof are reviewed by senior management through regular risk meetings. The aim
of the internal control systems is for management to provide reasonable assurance that the objectives will be met. In addition to
the above initiatives the Group also employs third party consultants to benchmark our operations against other mining operations
throughout South Africa and worldwide.

An important aspect of risk management is the transfer of risk to third parties to protect the Company from any major

disaster. We have embarked on a program to ensure that our major assets and potential business interruption and liability claims
are covered by group insurance policies that encompass our operations. The majority of the cover is through reputable insurance
companies in London and continental Europe and the insurance programs are renewed on an annual basis. A cell captive
insurance company has been established to enable further reduction in annual insurance premiums.

Audit and Risk Committee

On February 11, 2005, the Audit and Risk Committees started conducting joint meetings in respect of the quarterly

meetings. The members meet and the business of each committee is handled in joint deliberations taking place on the issues
raised. The Audit and Risk Committee is chaired by Mr. R.P. Hume. The reason for the joint sittings is that there is a great deal of
overlap between the financial risks discussed at Audit Committee level and at Risk Committee level. The joint sittings of the
Committees bring about better disclosure and ensure that the Company conforms more closely to the process prescribed by the US
Sarbanes-Oxley Act of 2002.

As of September 30, 2014 the Audit and Risk committees were combined into one committee called the Audit and Risk

Committee consisting independent non executive directors only namely, Mr. R.P. Hume (Chairman), Mr. J. Turk, J.A. Holtzhausen,
G.C. Campbell and Mr. E.A. Jeneker.

Social and Ethics Committee

As at June 30, 2014, the Social and Ethics Committee consisted of Mr. E.A. Jeneker (Chairman), Mr. D.J. Pretorius and

Mr F van der Westhuizen. As at September 30, 2014, the Social and Ethics Committee consisted of Mr. E.A. Jeneker (Chairman),
Mr. D.J. Pretorius and Mr W.J Schoeman.

The board, taking into account that all the group’s operations are based in South Africa and in order to achieve the triple

bottom line espoused in the King III Report and in order to reach the empowerment goal to which it is committed, establishing a
committee, the focus of which will be transformation and sustainable development. The terms of reference were approved by the
board at the August 2008 meeting. The board resolved to convert the Transformation and Sustainable Development Committee
into the Social and Ethics Committee which the Company is required to set up in terms of the Companies Act, 2008 of South
Africa. The objectives of this committee are:

· promoting transformation within the company and the economic empowerment of previously disadvantaged
communities, particularly within 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.

Terms of Reference of combined committees

The terms of reference of the combined committees are in the process of being aligned and the board will consider and

approve such alignment.

6D. EMPLOYEES

Employees

The geographic breakdown of our employees (including specialized service providers who are contracted employees

employed by third parties), was as follows at the end of each of the past three fiscal years:

Year ended June 30

2014

2013

2012

South Africa .................................................................................................................................................

2,329

2,752

2,222

The total number of employees at June 30, 2014, of 2,329 comprises 1,340 specialized service providers and 989 employees

who are directly employed by us and our subsidiary companies. As of September 30, 2014, we had 2,323 employees (including 1,340
contract employees).

As of June 30, 2014, the breakdown of our employees by main categories of activity for the periods below was as follows:

Year ended June 30,

Category of Activity

2014

2013

2012

Mining - Our Employees ................................................................................................................

Mining - Specialized service providers...........................................................................................

1,382

1,740

1,430

Engineering ......................................................................................................................................

329

427

311

Metallurgy .......................................................................................................................................

411

311

318

Mineral Resources ...........................................................................................................................

Administration .................................................................................................................................

144

129

Environmental .................................................................................................................................

Human Resources ............................................................................................................................

Medical and Safety ..........................................................................................................................

Total .................................................................................................................................................

2,329

2,752

2,222

Labor Relations

As at June 30, 2014, we employed and contracted 2,329 people in South Africa. Approximately 80% of our South African

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, the main South African mining industry union, 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 DRDGOLD and NUM coordinating forum meets regularly to discuss matters pertinent to both parties at a EMO
level, while operations level forums continue to deal with local matters.

In October 2013, the NUM rejected the company’s offer of a 8.0% increase for categories 4 -5 and a 7.5% increase for

categories 6 – 15 for Ergo and ERPM. The NUM also rejected the 10% increases in the living out allowances for fiscal 2013 and
fiscal 2014. The NUM was granted strike certificates in respect of the two operations and strike action started with the morning
shift on Tuesday, October 8, 2013.

On October 9, 2013, Ergo and ERPM signed a two year wage settlement agreement with effect from July 1, 2013, with

NUM and UASA, which provides for average annual compensation increases in year one of 10% for categories 4 – 5, 9% for
categories 6 – 7 and 8% for categories 8 – 15; and in year two 8% for categories 4 – 5 and 7.5% for categories 6 – 15.

On September 4, 2014, Ergo and ERPM extended the two year wage settlement agreement with effect from July 1, 2015

to June 30, 2016, with NUM and UASA, which provides for average annual compensation increases in year one of 10% for
categories 4 – 5, 9% for categories 6 – 7 and 8% for categories 8 – 15.

The Company is placing a greater emphasis on its Corporate Social Responsibility by becoming increasingly involved in

appropriate projects that give effect to the ideals of the Mining Charter and good corporate governance. We recognize the need for
transformation and have put structures in place to address this at both management and board level.

By statute we are required to pay each employee who is dismissed for reasons based on the operational requirements of

our operations, a severance package of not less than one week’s remuneration for every completed year of service. In specific
agreements with organized labor we undertook, as in the past, to pay packages equal to two weeks basic pay for every completed
year of service as part of a balancing compromise with the labor unions between the high additional costs of non-financial items
and incentive payments (which are deemed part of remuneration), and an additional one week benefit based on basic pay. These
employees were provided with counseling services and the opportunity to undergo skills training to be able to find employment
outside the mining industry.

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 2014 overall safety statistics for our operations:

(Per million man hours)

Year ended June 30,

2014

2013

Lost time injury frequency rate (LTIFR)

...............................................................................................

2.16

4.35

Reportable incidence

...............................................................................................................................

0.93

1.69

Fatalities

....................................................................................................................................................

0.00

Number of fatalities (average per month) ................................................................................................

0.00

Calculated as follows: actual number of instances divided by the total number of man hours worked multiplied by one million.

6E. SHARE OWNERSHIP

As of June 30, 2014, options to purchase ordinary shares held by directors and prescribed officers were as follows:

Directors

Options at

June 30,

2013

Average

strike

price

(R)

Options

bought back

during the

year

Average

Gain on

buy

back

(R)

Options

lapsed

during

the

year

Options at

June 30,

2014

Average

Strike

price

(R)

Expiration

Dates

Executive
C.C. Barnes ..............

234,504

4.56

(163,311)

1.56

(71,193)

F.D. van der

Westhuisen ............

53,525

5.12

(34,975)

1.51

18,550

5.12

10/18/2015-

11/02/2016

Prescribed

Officers

C.M. Symons ...........

212,050

4.84

(127,000)

1.44

85,050

5.12

10/18/2015-

11/02/2016

T.J. Gwebu ...............

192,650

4.68

(125,900)

1.51

66,750

5.12

10/18/2015-

11/02/2016

W.J Schoeman .........

198,350

5.12

(99,175)

1.26

99,175

5.12

2/11/2016

Each option is representative of a right to acquire one ordinary share at a predetermined exercise price as set forth in

"DRDGOLD (1996) Share Option Scheme, or the scheme."

Closed periods apply to share trading by directors and other employees, whenever certain employees of the Company

become or could potentially become aware of material price sensitive information, such as information relating to an acquisition,
quarterly results etc., which is not in the public domain. When these employees 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 quarterly results the closed-period is group-wide.

To the best of our knowledge, we believe that our ordinary shares held by executive officers, 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.”

DRDGOLD (1996) Share Option Scheme, or the Scheme

We operate a securities option plan as an incentive tool for our Executive Directors and senior employees whose skills and

experience are recognized as being essential to the Company’s performance. Two of our Non-Executive Directors (Messrs.
G.C. Campbell and R.P. Hume) had share options under the Scheme which has all been bought out by the Company through a
general buy-out; no new share options have been issued to Non-Executive Directors since December 2004. In compliance with JSE
Listing Requirements, options awarded to an individual employee are subject to a cumulative upper limit of 2.0 million options,
which is lower than the previous 2% of the Company’s issued share capital. In addition, a maximum of 40.0 million options are
available for utilization under the share option scheme, which is lower than the previous 15% of the issued ordinary shares. As at
September 30, 2014, the number of issued and exercisable share options was approximately 0.3% of our issued ordinary share
capital, representing 1.2 million share options. In November 2012 the Remuneration Committee suspended the share option
scheme and approved a share buyback. A general offer was made to all participant of the Scheme to buy-back all then vested share
options as part of the transition to the new DRDGOLD Phantom Share Scheme. Not all share options were bought back and at June
30, 2014, 279,778 vested share options remained outstanding. The participants in the Scheme are fully taxed based on individual
tax directives obtained from the South African Revenue Service on any gains realized on the exercise of share options.

Certain Directors hold options which expire at various times. For those directors, a range is provided indicating the earliest and latest expiration

dates.

The price at which an option may be granted will be, in respect of each share which is the subject of the option, the volume

weighted average price of a share on the JSE for the seven days on which the JSE is open for trading, preceding the day on which the
employee is granted the option. The allocation date will be the date when the directors approve allocation of share options. Each
option remains in force for five years after the date of grant (ten years if issued prior to 2009), subject to the terms of the option plan.
Options granted under a plan vest primarily according to the following schedule over a maximum of a three year period:

Percentage vested in each period

Period after the original date of the option grant

25%

6 months

25%

1 year

25%

2 years

25%

3 years

Any options not exercised within five years (issued prior to 2009: ten years) from the original date of the option grant will

expire and may not thereafter be exercised. The previous bi-annual allocation of options was changed in April 2006 to an annual
allocation.

Options to purchase a total of 1,238,028 ordinary shares were outstanding on June 30, 2014, of which 279,778 options to

purchase ordinary shares were currently exercisable. In fiscal 2014, a total of 36 employees and 1 ex-employee participated in the
Scheme, including Executive Directors and other senior employees. The outstanding options are exercisable at purchase prices that
range from R5.12 to R10.93 per share and expire five years (issued prior to 2009: ten years) from the date of issue to the participants.

In August 2012, the board of directors decided to replace the Scheme with a cash-settled phantom share scheme. The new

phantom share scheme was approved by the board of directors in October 2012. In November 2012 the Remuneration Committee
suspended the Scheme and approved the share option buy back. The advantages presented by the suspension of the Scheme and share
option buy back are inter alia:

avoidance of dilution of current shareholders; and

avoidance of short vesting periods.

DRDGOLD Phantom Share Scheme

In fiscal 2013 we established the DRDGOLD Phantom Share Scheme, The scheme, replaces the DRDGOLD (1996)

Share Option Scheme, which is part of the long-term retention strategy intended to grow the company. The phantom share scheme
is operated as an incentive tool for our executive directors, excluding the CEO, and senior employees whose skills and experience
are recognized as being essential to the Company’s performance. For details regarding the remuneration structure of the CEO
refer to Item 6B. The scheme is cash settled. In terms of the phantom share scheme rules, 50% of the phantom shares granted will
be valued based on the Group meeting certain pre-determined performance criteria and the remaining 50% to defined retention
periods. The maximum incentive pay-out per annum to any single employee may not exceed 75% of that employee’s gross
remuneration package. The participants in the scheme are fully taxed at their marginal rate on any gains realized on the exercise of
their phantom shares.

The phantom share granted has a zero base value, however the number of phantom shares granted by the Remuneration

Committee is determined by the price in respect of each share which is the subject of the phantom share, the volume weighted
average price of a share on the JSE for the seven days on which the JSE is open for trading, preceding the day on which the
employee is granted a phantom share. The allocation date will be the date when the directors approve allocation of the phantom
shares. Each phantom share remains in force until the date of vesting, subject to the terms of the scheme rules. Phantom shares
granted under the phantom share scheme vest primarily according the following schedule over a maximum of a three year period:

Percentage vested in each period grant:

Period after the original date of grant

of the option:

Performance criteria

Retention criteria

33%

one year

33%

50%

two years

33%

50%

three years

Any phantom shares not exercised on the date of vesting will expire and may not thereafter be exercised. 1,964,033

phantom shares were granted in the current financial year, (2013: 3,019,549). 3,706,102 phantom shares were outstanding on
June 30, 2014 (2013: 3,019,549).

ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

7A. MAJOR SHAREHOLDERS

As of September 30, 2014, our issued capital consisted of:

· 385,383,767 ordinary shares of no par value; and
· 5,000,000 cumulative preference shares.

To our knowledge, we are not directly or indirectly owned or controlled by another corporation or any person or foreign

government and 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, 2014:

· there were 5,339 record holders of our ordinary shares in South Africa, who held approximately 90,940,607 or
approximately 23.6% of our ordinary shares;
· there was one record holder of our cumulative preference shares in South Africa, who held 5,000,000 or 100% of our
cumulative preference shares;
· there were no US record holders of our ordinary shares, excluding those shares held as part of our ADR program; and
· there were 786 registered holders of our ADRs in the United States, who held approximately 213,066,460 (21,306,646
ADRs) or approximately 55.43% of our ordinary shares.

The following table sets forth information regarding the beneficial ownership of our ordinary shares as of September 30,

2014 by:

· each of our directors and prescribed officers; and
· any person whom the directors are aware of as at September 30, 2014 who is interested directly or indirectly in 5% 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

Owned

Holder

Number

Percent of

outstanding

ordinary

shares

D.J. Pretorius ............................................................................................................................................

291,167

C.C. Barnes ..............................................................................................................................................

None

F.D. van der Westhuizen .........................................................................................................................

None

A.T. Meyer ...............................................................................................................................................

None

J. Turk .......................................................................................................................................................

243,000

G.C. Campbell .........................................................................................................................................

150,000

R.P. Hume ................................................................................................................................................

150,000

E.A. Jeneker .............................................................................................................................................

None

J.A. Holtzhausen ......................................................................................................................................

None

W.J. Schoeman ........................................................................................................................................

None

C.M. Symons ...........................................................................................................................................

None

T.J. Gwebu ...............................................................................................................................................

None

Bank of New York Mellon ADRs ..........................................................................................................
101 Barclay Street
New York, NY 10011

212,548,386

55.15%

* Indicates share ownership of less than 1% of our outstanding ordinary shares.

Includes the following:

a shareholding acquired by Van Eck Associates Corporation ("Van Eck"). According to a Schedule 13-G filed by Van Eck with the SEC
on October 9, 2014, Van Eck Associates Corporation held 16.07% of the total issued ordinary share capital of the Company at this date. At
Subsequently this shareholding increased to 16.99% of the total issued ordinary share capital of the Company; and

a shareholding held by Skagen AS ("Skagen") amounting to 9.66% of the total issued ordinary share capital of the Company.

Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment

power with respect to securities. Ordinary shares issuable pursuant to options, to the extent the options are currently exercisable or
convertible within 60 days of September 30, 2014, are treated as outstanding for computing the percentage of any other person. As of
September 30, 2014, we are not aware of anyone owning 5% or more of our ordinary shares other than the Bank of New York Mellon
which holds 55.15% of our issued ordinary shares through our ADR program as described. During fiscal 2014 the Public Investment
Corporation disposed of its 5.0% shareholding that it held as at the end of fiscal 2013 and Investec Asset Management reduced its
shareholding of 7.05% held as at the end of fiscal 2013 to 3.08% as at September 30, 2014. Both of the above were in the normal
course of business. Unless otherwise noted, each person or group identified possesses sole voting and investment power with respect
to the shares, subject to community property laws where applicable. No shareholder has voting rights which differ from the voting
rights of any other shareholder. Unless indicated otherwise, the business address of the beneficial owner is: DRDGOLD Limited, 50
Constantia Boulevard, Constantia Kloof Ext. 28, Roodepoort, 1709, South Africa.

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 Third Floor, Sandton City Office Tower, 158 Fifth Street, Sandton, 2196, South Africa.

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 Department of Mineral Resources (DMR) granted
DRDGOLD a prospecting right over an area which was going to be too small to mine. When an application for a greater area was
lodged, the DMR stated that the additional area is in an urban location and an application for a prospecting right cannot be
granted. We are in the process, together with Randgold, of cancelling these preference shares.

7B. RELATED PARTY TRANSACTIONS

Rand Refinery Proprietary Limited (Rand Refinery) agreement

The group has entered into an agreement with Rand Refinery, for the refining and sale of all of its gold produced in South

Africa. Under the agreement, Rand Refinery performs the final refining of the group’s gold and casts it into troy ounce bars. Rand
Refinery then sells the gold on the same day as delivery, for the London afternoon fixed price on the day the gold is sold. In exchange
for this service, the group pays Rand Refinery a variable refining fee plus fixed marketing, loan and administration fees. Mr Gwebu,
executive: legal, compliance and company secretary of DRDGOLD, was a director of Rand Refinery and a member of its
Remuneration Committee and chairman of the Social and Ethics Committee until 3 September 2014 when he resigned as director. Mr
Charles Symons has been nominated to replace him as director of Rand Refinery. Mr Mark Burrell who is the financial director of
Ergo is an alternate director of Rand Refinery and a member of Rand Refinery’s Audit Committee. The Company currently owns
11.3% (Fiscal 2013: 11.3%) of Rand Refinery (which is jointly owned by South African mining companies). Other balances and
transactions include:

• Trade receivables to the amount of R25.6 million (2013: R30.4 million) relate to metals sold

• The group received a dividend of Rnil (2013: R6.8 million) from Rand Refinery.

Guardrisk Insurance Cell Captive (Guardrisk)

During FY2014 Ergo paid insurance premiums to the Guardrisk Cell Captive amounting to Rnil (2013: R21.0 million).

Guardrisk issued environmental guarantees to the DMR amounting to R305.7 million (2013: R305.7 million) relating to the
environmental liabilities. These guarantees are funded by the assets in Guardrisk Insurance Company Limited (Cell Captive).

Consultancy agreement

On June 23, 2008, EMO entered into a consultancy agreement with Khumo Gold SPV Proprietary Limited, or Khumo Gold,

which owns 20% of EMO and Blyvoor, to provide guidance and participate in the Company’s transformation initiatives set by the
Mineral and Petroleum Resources Development Act of South Africa. The agreement provides for a monthly retainer of R0.3 million
(2013: R 0.2 million, 2012: R 0.2 million)

Corporate Service Agreements and interest

DRDGOLD provides corporate services for EMO, Blyvoor (until June 1, 2012 when Blyvoor was sold), Ergo, Crown and

ERPM (until July 1, 2012 when Crown and the surface assets included in ERPM were restructured into Ergo) under corporate service
agreements entered into with each of them. These services include financial management, treasury services, gold administration,
technical and engineering services, mineral resource services and other corporate and governance related services. We own a 74%
interest in the issued share capital of EMO and until June 1, 2012 owned 74% of the issued share capital of Blyvoor. Ergo, Crown
and ERPM are wholly-owned subsidiaries of EMO. These arrangements allow us to monitor and provide input on the management of
these companies in which we have an investment.

DRDGOLD received management fees from EMO amounting to R21.9 million (2013: R25.1 million) and from Blyvoor

Rnil (2012: until June 1, 2012 when Blyvoor was sold R15.2 million).

The corporate services at Ergo, Crown and ERPM are provided by EMO. Crown and the surface assets in ERPM were

restructured into Ergo on July 1, 2012. EMO’s fee for services performed in fiscal 2014 at Ergo was R55.0 million (2013: R53.7
million), Crown Rnil (2013: Rnil) and ERPM Rnil (2013: Rnil).

DRDGOLD earned interest from EMO amounting to R30.0 million (2013: R23.0 million and 2012: R26.6million), from

Ergo Mining Proprietary Limited amounting to R28.5 million (2013: R32.2 million and 2012: Rnil) and from Blyvoor amounting
to Rnil (2013: Rnil and 2012: R2.6 million), respectively.

Treasury shares

As at June 30, 2014, EMO held 6,155,559 (2013: 6,205,559, 2012: 9,852,800) treasury shares in DRDGOLD. During the

year ended June 30, 2014, EMO acquired no (2013: nil, 2012: 9,852,800) treasury shares. During fiscal 2014, none (2013: 62,614,
2012: 3,584,627) of the treasury shares held by EMO were used to settle share options exercised by key management personnel.

Subordination agreements and letters of support to subsidiaries

In October 2013, DRDGOLD Limited entered into a subordination agreement with EMO, subordinating a loan made to

EMO amounting to R649.5 million as at June 30, 2014 (2013: R544.7 million), for the benefit of EMO’s third party creditors.
Consecutively, DRDGOLD Limited issued a letter of support to EMO committing to support EMO financially for 367 days from
July 1, 2013, or until all other liabilities are paid, or the total assets of EMO, fairly valued, exceeds its total liabilities, fairly valued,
and that DRDGOLD Limited will not call for the repayment of its loan within that period. This agreement was renewed during
October 2014.

Sale of shares

The non-controlling shareholders entered into an agreement with DRDGOLD for the sale of their shares in EMO (see to

material contracts).

Executive directors

The total amount of executive directors' remuneration paid and or accrued for the year ended June 30, 2014 was R11.2

million.

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—Legal Proceedings."

8. Please see Item 10B.: "Memorandum of Incorporation."

8B. SIGNIFICANT CHANGES

For a discussion of significant changes that have occurred since June 30, 2014, the date of the last audited financial

statements included in this Annual Report, please see Note 28 “Subsequent Events” under Item 18.: "Financial Statements," which
describes post balance sheet (statement of financial position) events.

ITEM 9. THE OFFER AND LISTING

9A. OFFER AND LISTING DETAILS

The following tables set forth, for the periods indicated, the high and low market sales prices and average daily trading

volumes of our ordinary shares on the JSE and ADSs on the New York Stock Exchange and Nasdaq Capital Market. On December
29, 2011, we transferred our listing from the Nasdaq Capital Market to the New York Stock Exchange.

Price

Per

Ordinary Share

Price Per

ADS

Average Daily

Trading

Volume

Year Ended

High

Low

High

Low

Ordinary

Share

ADSs

June 30, 2010 ...........................................................................................

6.98

3.20

9.00

4.07

691.256

209,087

June 30, 2011 ...........................................................................................

4.00

2.80

6.23

3.92

558,675

113,932

June 30, 2012 ...........................................................................................

6.28

2.97

8.16

4.21

1,090,043

97,107

June 30, 2013 ...........................................................................................

7.55

4.49

8.59

4.90

631,264

78,400

June 30, 2014 ...........................................................................................

6.64

2.45

6.47

2.39

594,552

117,380

Note that with effect from July 23, 2007, we changed our ADS ratio to reflect one ADS for ten of our ordinary shares.

Price

Per

Ordinary Share

Price Per

ADS

Average Daily

Trading

Volume

Quarter

High

Low

High

Low

Ordinary

Share

ADSs

Q1 July – September 2012 ......................................................................

5.49

4.49

6.71

5.35

380,536

37,224

Q2 October – December 2012 ................................................................

7.05

5.30

8.09

6.46

714,592

56,943

Q3 January – March 2013 .......................................................................

7.55

6.14

8.59

6.76

648,849

111,095

Q4 April – June 2013 ..............................................................................

7.18

4.60

7.85

4.90

785,537

108,424

Q1 July – September 2013 ......................................................................

6.64

4.81

6.47

4.89

377,790

69,694

Q2 October – December 2013 ................................................................

5.85

3.10

5.75

3.16

768,148

141,115

Q3 January – March 2014 .......................................................................

4.80

3.70

4.46

3.64

579,034

127,258

Q4 April – June 2014 ..............................................................................

4.04

2.45

3.83

2.39

660,626

131,197

Q1 July – September 2014 ......................................................................

4.03

2.52

3.65

2.37

587,358

170,377

Price

Per

Ordinary Share

Price Per

ADS

Average Daily

Trading Volume

Month Ended

High

Low

High

Low

Ordinary

Share

ADSs

April 30, 2014 ..........................................................................................

4.04

3.28

3.83

3. 01

523,141

122,165

May 31, 2014 ...........................................................................................

3.40

2.50

3.28

2.41

825,947

85,783

June 30, 2014 ...........................................................................................

3.51

2.45

3.45

2.39

625,915

185,643

July 31, 2014 ............................................................................................

3.35

2.52

3.27

2.53

575,337

109,547

August 31, 2014 .......................................................................................

3.05

2.56

2.89

2.50

341,492

53,263

September 30, 2014 .................................................................................

4.03

2.56

3.65

2.37

846,389

351,216

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, 2014, nor have there been any trading suspensions with respect to our ADRs on the Nasdaq Capital Market from June 30,
2010 until December 29, 2011 and the New York Stock Exchange since our listing on that market.

9B. PLAN OF DISTRIBUTION

Not applicable.

9C. MARKETS

Nature of Trading Markets

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). Our ordinary shares also trade on the Marche Libre on the Paris Bourse (symbol: DUR) and
Brussels Bourse (symbol: DUR) in the form of International Depository Receipts. The ordinary shares also trade on the over the
counter markets in Berlin, Stuttgart and the Regulated Unofficial Market on the Frankfurt Stock Exchange. 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. Prior to December 29, 2011, our ADSs traded on the Nasdaq
National Market.

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, 2014, we had authorized for issuance 600,000,000 ordinary shares of no par value (as of September 30, 2014:

600,000,000), and 5,000,000 cumulative preference shares of R0.10 par value (as of September 30, 2014: 5,000,000). On this date we
had issued 385,383,767 ordinary shares (as of September 30, 2014: 385,383,767) and 5,000,000 cumulative preference shares (as of
September 30, 2014: 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 September 30, 2014. 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.

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 Report on Corporate Governance for South Africa (King III Report) which came into effect on March 1, 2010,

sets out guidelines to promote the highest standards of corporate governance among South African companies. The board of directors
believes that our business should be conducted according to the highest legal and ethical standards. In accordance with the board
practice, all remuneration of executive directors is approved by the Remuneration Committee, and the shareholders approve
remuneration of non-executive directors.

DRDGOLD commits itself to observing the provision of the King III Report and enforcing these to the extent possible

within the context of the report’s ‘apply or explain’ principle.

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 non-executive 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 is intended to subject
executive directors to re-election by rotation will be proposed 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 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.

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 September 30, 2014, 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 the MOI

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.

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.

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

ZAR2,000,000,000 Domestic Medium Term and High Yield Note Programme (“DMTN Programme”) agreement

entered into between DRDGOLD Limited (“Issuer”), Crown Gold Recoveries Proprietary Limited (“Crown”), East Rand
Proprietary Mines Limited (“ERPM”), Ergo Mining Operations Proprietary Limited (“EMO”), Ergo Mining Proprietary
Limited (“Ergo”) and ABSA Bank Limited (“ABSA”) dated June 30, 2012.

Under this agreement the Issuer may from time to time issue loan notes to certain investors. The maximum aggregate

nominal amount of all such notes from time to time outstanding under the DMTN Programme may not exceed R2,000,000,000
(two billion South African Rand). Crown, ERPM, EMO and Ergo (“Guarantors”) are joint and several guarantors in favour of the
Issuer. The Guarantors guarantee to the holders of the notes the due and punctual performance by the Issuer of its payment
obligations under the DMTN Programme. The notes may be listed on the JSE Limited. ABSA Capital, a division of ABSA Bank
Limited, has been appointed dealer and arranger of the notes.

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.

Under this agreement the Seller agreed to sell its entire shareholding in Blyvoor and its working capital and shareholder

loan claims against Blyvoor to the Purchaser. The purchase consideration is discharged by Village through the issue of 85,714,286
new ordinary shares in Village. Refer to Item 5A.: “Operation Results - Recent developments” for a more detailed discussion.

Sale of Interest Agreement between DRDGOLD Limited (“DRDGOLD”) and Ergo Mining Proprietary Limited

(“Ergo Mining”) dated June 29, 2012.

Under this agreement DRDGOLD sells and Ergo Mining purchases DRDGOLD’s 35% participation interest in the assets

and liabilities of the unincorporated joint venture, called ErgoGold (previously called the Elsburg JV), between DRDGOLD and
East Rand Proprietary Mines Limited. The purchase price payable is R200,000,000 (two hundred million South African rand).
The purchase price was advanced by DRDGOLD to Ergo on loan account.

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.

Under this agreement the Ergo Group grants TCTA access to land for the construction of a water treatment plant, access

to the South West Vertical Shaft of ERPM to construct and operate a pump station to pump the acid mine drainage (“AMD”) to
surface, the right to construct a sludge pipeline using servitudes owned by the Ergo Group members, shared use of an Ergo Group
residue pipeline and partial use of the Ergo tailings dams for the deposition of up to 4 167m³ of sludge per day, emanating from
the water treatment plant. EMO has an option to acquire from TCTA, for its operations up to 30 mega litres of untreated or
partially treated AMD per day.

Share Sale and Subscription Agreement between DRDGOLD Limited ("DRDGOLD"), Khumo Gold SPV Proprietary

Limited ("Khumo") and DRDSA Empowerment Trust (the Trust), dated March 17, 2014

On March 17 2014, Khumo and DRDGOLD, the ultimate majority holding company of Ergo, entered into the Share Sale

and Subscription Agreement in respect of which DRDGOLD agreed to acquire all of the shares in and claims against EMO, held
by Khumo, subject to the fulfilment of certain conditions. On the same day, the Trustees of the DRDSA Empowerment Trust and
DRDGOLD entered into the Share Sale and Subscription Agreement in respect of which DRDGOLD agreed to acquire all of the
shares in and claims against EMO held by the Trust, subject to the fulfilment of certain conditions. The consequence of the
proposed acquisitions contemplated in the proposed transaction is that, on fulfilment of the conditions stated in these agreements,
DRDGOLD will acquire Khumo’s 20% interest in EMO in exchange for 35 000 000 new DRDGOLD ordinary shares; and
DRDGOLD will acquire the Trust’s 6% interest in EMO in exchange for 10 500 000 new DRDGOLD ordinary shares, thereby
amounting to a change of shareholding in EMO and DRDGOLD (the ultimate majority holding company).

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 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 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 SARB.

Foreign investment and outward loans by South African companies are also restricted. In addition, without the approval of

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 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 SARB is required in advance for investments in excess of R500 million. On application to
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, 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,
SARB may instruct that the equity be disposed of. In our experience SARB has taken a commercial view on this, and has on
occasion extended the period of time for compliance; and
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 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.

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, South African non-residents 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.

In 1993, all existing gold mining companies had the option to elect to be exempt from secondary tax on companies, or

STC. If the election was made, a higher tax rate would apply for both mining and non-mining income. With the introduction of
dividends tax at a rate of 15% which replaced STC with effect from April 1, 2012, the election on STC is not applicable anymore.
These amendments are set out in Part VIII in Chapter II of the Income Tax Act. Section 64F of the amendments, 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 US resident (within the meaning of the Tax Treaty) to
5% of the gross amount of the dividends if such US resident is a company which holds directly at least 10% of our voting stock and
15% 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 US, 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 2014 and 2013, the corporate tax rates for taxable mining and non-mining income were 34% and 28%,

respectively. The Company, is subject to 34% tax on mining income and 28% for non-mining income. The formula for
determining the South African gold mining tax rate for FY2014 and FY2013 is: 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.

Capital Gains Tax

Non-residents are generally not subject to Capital Gains Tax, or CGT, in South Africa. They will only be subject to CGT on

gains arising from the disposal of capital assets if the assets disposed of consist of:

immovable property owned by the non-residents situated in South Africa, or any interest or right in or to immovable
property. A non-resident will have an interest in immovable property if it has a direct or indirect shareholding of at least
20% in a company, where 80% or more of the net assets of that company (determined on a market value basis) are
attributable directly or indirectly to immovable property; or
any asset of a permanent establishment of a non-resident in South Africa through which a trade is carried on.

If the non-residents are not subject to CGT because the assets disposed of do not fall within the categories described above,

it follows that they will also not be able to claim the capital losses arising from the disposal of the assets.

Material United States Federal Income Tax Consequences

The following is a summary of material US federal income tax consequences to US holders (as defined below) of the

purchase, ownership and disposition of ordinary shares or ADSs. It deals only with US holders who hold ordinary shares or ADSs as
capital assets for US 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 US federal income taxation that may be applicable to holders in light of their

particular circumstances and does not address special classes of US holders subject to special treatment (such as dealers in securities
or currencies, partnerships or other pass-through entities, banks and other financial institutions, insurance companies, tax-exempt
organizations, 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 US dollar, or persons that actually or constructively own ten percent or more of our voting stock). This
discussion addresses only US federal income tax consequences 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.

A “US holder” is a beneficial owner of ordinary shares or ADSs that is, for US federal income tax purposes:

a citizen or resident of the US;
a corporation or other entity subject to tax as a corporation that is created or organized under the laws of the US or any
political subdivision thereof;
an estate, the income of which is subject to US federal income tax without regard to its source; or
a trust, if a court within the US is able to exercise primary supervision over the administration of the trust and one or more
US 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 US person.

If a partnership (or an entity treated as a partnership for US 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, US holders of ordinary shares or ADSs are urged to consult their tax

advisors concerning the US federal income tax consequences applicable to their particular situations as well as any
consequences 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 US holder of ADSs will be treated for US 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 US 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 US holders as ordinary dividend income to the extent that the distributions do not exceed our current and
accumulated earnings and profits. For US federal income tax purposes, the amount of any distribution received by a US 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
US 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 US 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 US 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 US federal income tax purposes. US 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 US holders (as well as certain trusts and estates) generally will be taxed

at a maximum US 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 US 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 US. 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”. US holders are urged to consult their tax advisors regarding
the US 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 US 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 US 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 US holders, “general category income.”

Disposition of Ordinary Shares or ADSs

Subject to the discussion below under the heading “Passive Foreign Investment Company”, upon a sale, exchange, or other

taxable disposition of ordinary shares or ADSs, a US holder will recognize gain or loss in an amount equal to the difference between
the US 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 below, such gain or loss generally will
be capital gain or loss and will be long-term capital gain or loss if the US 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 US holder on the taxable disposition
of ordinary shares or ADSs generally will be treated as US-source gain or loss for US foreign tax credit purposes.

In the case of a cash basis US 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 US holder who
receives payment in rand and converts rand into US 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 US 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 US holder may have a foreign currency gain or loss for US federal income tax purposes because of the
differences between the US 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
US holder on the disposition of such ordinary shares or ADSs.

Passive Foreign Investment Company

A special and adverse set of US federal income tax rules apply to a US holder that holds stock in a passive foreign

investment company, or PFIC. We would be a PFIC for US 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, US 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 US holder during a single taxable year that is greater than 125% of the average
amount of distributions received by such US holder during the three preceding taxable years in respect of the ordinary shares or
ADSs or, if shorter, such US holder's holding period for the ordinary shares or ADSs). Under these rules:

· the gain or excess distribution will be allocated ratably over a US holder's holding period for the ordinary shares or ADSs, as
applicable;
· the amount allocated to the taxable year in which a US 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 US holder if we are a PFIC for any year during a US holder's

holding period, if we cease to satisfy the requirements for PFIC classification, the US 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 US holder of a PFIC are required to file an annual report with the Internal Revenue Service containing such information

as the US Secretary of Treasury may require.

A US 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 US 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 US 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 US
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 US holder's death, the tax basis of the ordinary shares or ADSs in the hands of a US 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. US 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 US 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 US 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 2014 fiscal year ended June 30, 2014. However, under the PFIC rules income

and assets are require to be measured and classified in accordance with US federal income tax principles. Our analysis is based on our
financial statements as prepared in accordance with IFRS, which may substantially differ from US federal income tax principles.
Therefore, no assurance can be given that we were not a PFIC for our 2014 fiscal year ended June 30, 2014. Furthermore, the ctests
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. US holders are urged to consult their tax advisors regarding the application of
the PFIC rules to their investments in our ordinary shares or ADSs.

Information Reporting and Backup Withholding

Payments made in the United States or through certain US-related financial intermediaries of dividends or the proceeds of

the sale or other disposition of our ordinary shares or ADSs may be subject to information reporting and US federal backup
withholding if the recipient of such payment is not an “exempt recipient” and fails to supply certain identifying information, such as
an accurate taxpayer identification number, in the required manner. Generally, individuals are not exempt recipients, whereas
corporations and certain other entities generally are exempt recipients. The backup withholding tax rate is currently 28%. Payments
made with respect to our ordinary shares or ADSs to a US holder must be reported to the Internal Revenue Service, unless the US
holder is an exempt recipient or otherwise establishes an exemption. Any amount withheld from a payment to a US holder under the
backup withholding rules is refundable or allowable as a credit against the holder's US federal income tax, provided that the required
information is furnished to the Internal Revenue Service.

Under the Hiring Incentives to Restore Employment Act enacted on March 18, 2010, in taxable years beginning after the

date of enactment, a US holder may be required to submit to the Internal Revenue Service certain information with respect to such
US holder's beneficial ownership of ordinary shares or ADSs, if such ordinary shares or ADSs are not held on such US holder's
behalf by a financial institution. This new law also imposes penalties if a US holder is required to submit such information to the
Internal Revenue Service and fails to do so.

US holders should consult their tax advisors regarding application of the information reporting and backup withholding

rules.

10F. DIVIDENDS AND PAYING AGENTS

On August 28, 2014, we declared a dividend which, in total, amounted to R7.7 million (2.0 cents per ordinary share).

Dividends tax is 15% of the dividend paid, lower rates can apply for foreign beneficial owners and there are also certain exemptions
that apply. The dividends tax, where relevant, will be withheld from the dividend payment. There are no dividend restrictions.

Date of entitlement:

November 14, 2014

Approximate date of conversion:

November 21, 2014

Approximate payment date:

November 24, 2014

Paying agents:

Link Market Services (US and SA)

St James’s Corporate Services Limited (UK)

Computershare (Australia)

10G. STATEMENT BY EXPERTS

Not

applicable.

10H. DOCUMENTS ON DISPLAY

You may request a copy of our US Securities and Exchange Commission filings, at no cost, by writing or calling us at

DRDGOLD Limited, P.O. Box 390, Maraisburg, Johannesburg, South Africa 1700. Attn: Group Company Secretary. Tel No. +27-
11-470-2600. A copy of each report submitted in accordance with applicable United States law is available for public review at our
principal executive offices.

A copy of each document concerning us that is referred to in this Annual Report, is available for public view at our principal

executive offices at DRDGOLD Limited, Quadrum Office Park, Building 1, 50 Constantia Boulevard, Constantia Kloof Ext.28,
South Africa 1709.

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. We do not hold or issue derivative financial instruments for speculative purposes, nor do we hedge forward gold
sales.

Refer to Item 18. ‘‘Financial Statements - Note 25 - Financial instruments’’ of the consolidated financial statements for a

qualitative and quantitative discussion of our exposure to these market risks.

Commodity price risk

The 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, 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 gold price is impossible for us to predict. The price of gold may not remain at a level allowing us to economically exploit our
reserves. It is our policy not to hedge this commodity price risk.

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.

Our financial instruments do not represent a significant concentration of credit risk, because we deal with a variety of major

banks and financial institutions located in South Africa after evaluating the credit ratings of the representative financial institutions.
Furthermore, our trade receivables and loans are regularly monitored and assessed for recoverability. Where it is appropriate, an
impairment loss is raised. In addition, our South African operations deliver their gold to Rand Refinery Proprietary Limited (Rand
Refinery), which refines the gold to saleable purity levels and then sells the gold, on behalf of the South African operations, on the
bullion market. Any potential shortfall in inventory in Rand Refinery is secured by the loan arrangement and to the extent of this
facility, between it and its shareholders (refer Item 5A.: “Financial instruments”). The gold is sold by Rand Refinery usually on the
same day as it is delivered and settlement is made within two days.

Foreign currency risk

Our reporting currency is the 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 relatively insignificant.

Long-term debt

Set out below is an analysis of our debt as at June 30, 2014, analyzed between fixed and variable interest rates. All of our

long-term debt is denominated in South African rand.

Total

R'000

Interest rate
Variable rate ...........................................................................................................

148,695

Weighted average interest rate ..........................................................................

8.9% - 10.6%

Fixed rate ................................................................................................................

Weighted average interest rate ..........................................................................

Total ........................................................................................................................

148,695

Repayment period
2015 ........................................................................................................................

73,195

2016 ........................................................................................................................

75,500

Total ........................................................................................................................

148,695

Based on our fiscal 2014 financial results, a hypothetical 100 basis points (increase)/decrease in interest rate activity would

(increase)/decrease our interest expense by R1.4 million.

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)

Cancellation of ADSs for the purpose of withdrawal, including if the Deposit
Agreement terminates ...................................................................................................

$5.00 (or less) per 100 ADSs (or

portion thereof)

Distribution 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 other governmental 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.

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 amount of $483,680.81 mainly

consisting of accumulated contributions towards the Company’s investor relations activities (including investor meetings,
conferences and fees of investor relations service vendors).

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.

In practice, the Depositary has not collected these fees. If collected, such fees are offset against the related distribution made to the ADR

holder.

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, 2014, our management, with the participation of our Chief Executive Officer and Acting Chief Financial

Officer has evaluated the effectiveness of our disclosure controls and procedures (as this term is defined under the rules of the
SEC). Our management, including the Chief Executive Officer and Acting Chief Financial Officer, concluded that our disclosure
controls and procedures were effective as of June 30, 2014.

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 Acting 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 Acting 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, 2014. In

making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the
Treadway Commission (COSO) (1992) in Internal Control-Integrated Framework. Based on our assessment and those criteria, our
management concluded that as of June 30, 2014 our internal control over financial reporting was effective.

15C. Independent Auditor’s Attestation Report

The effectiveness of internal control over financial reporting as of June 30, 2014 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.

During the year ended June 30, 2014, 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. R.P. Hume, 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 and independent 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 Ethics and Conduct that applies to all senior executives including our Non-Executive

Chairman, the Chief Executive Officer, Chief Financial Officer, Chief Operating Officer and the Group Financial Manager and
Financial Manager at each mining operation as well as all other employees. The Code of Ethics was last updated on February 9,
2012. The Code of Ethics and Conduct can be accessed on the Company’s website at www.drdgold.com.

ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES

KPMG Inc. has served as our independent public accountant for the fiscal years ending June 30, 2014, 2013 and 2012, 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 2014 and 2013:

Auditors' remuneration

Year ended June

30,

2014

2013

R’000

Audit fees ............................................................................................................................................................... 5,712 6,702
Audit-related fees ................................................................................................................................................... 75

Tax fees ................................................................................................................................................................. - -
All other fees ......................................................................................................................................................... -

458

5,787

7,160

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.

Audit-Related Fees

The audit related fees consist of fees invoiced with respect to the reporting accountants report issued on the pro forma

financial information included in a circular issued by the company on May 6, 2014 in connection with the acquisition by the
Company of Khumo Gold SPV Proprietary Limited’s 20% interest in Ergo Mining Operations Proprietary Limited in exchange
for 35 000 000 new DRDGOLD ordinary shares; and • the proposed acquisition by the Company of the DRDSA Empowerment
Trust’s 6% interest in Ergo Mining Operations Proprietary Limited in exchange for 10 500 000 new DRDGOLD ordinary shares.

For fiscal 2013, no audit-related fees were incurred.

Tax Fees

For fiscal 2014 and fiscal 2013, no fees have been billed for tax compliance, tax advice or tax planning services.

All Other Fees

All other fees consist of all fees billed which are not included under audit fees, audit related fees or tax fees.

The other fees billed in 2013 related to agreed upon procedures consisting of a gap analysis on our Integrated Report for

fiscal 2013, which is an annual report required by King III and provides an account of our operational, financial, economic, social
and environmental performance, as well our governance, and limited assurance on specified items contained in our Sustainable
Development Report for fiscal 2013, which is an annual report in line with the Global Reporting Initiative and provides an
account of our economic, social and environmental performance. There were no such fees billed for in fiscal 2014 at June 30,
2014. Subsequent to June 30, 2014 KPMG was engaged to provide limited assurance on specified items contained in our
Integrated Report for fiscal 2014 that will be billed during fiscal 2015.

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. The Audit and Risk Committee
considered all of the fees mentioned above and determined that such fees are compatible with maintaining KPMG Inc.��s
independence.

ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES

Not applicable.

ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS

Not applicable.

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:

Independence of audit and risk committee members

NYSE Listing Standards require a NYSE listed company to have an audit committee composed of at least three independent

members. A foreign private issuer may be exempted from the requirement that all members of the audit committee qualify as
independent under NYSE Listing Standards Rules provided, among other requirements, that the members of the audit committee are
independent under Exchange Act Rule 10A-3. As at June 30, 2014 all of our audit committee members were and as at September 30,
2014 all of our audit and risk committee members are independent both under the NYSE Listing Standards and the South African
Johannesburg Stock Exchange Rules.

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 country rule.

Executive Sessions

Section 303A.03 of the NYSE Listing Standards provides that “non-management” directors of listed companies must meet

at regularly scheduled executive sessions in the absence of management. The JSE Listings Requirements makes no provision for such
meetings, however the non-executive directors of DRDGOLD do meet without management on a regular basis but in an informal
setting and no minutes are prepared.

100

Nominations Committee

Section 303A.04 of the NYSE Listing Standards provides listed companies must have a nominating/corporate governance

committee composed entirely of independent directors. The JSE Listings Requirements only require that the members of such a
committee be non-executive directors, the majority of whom must be independent. DRDGOLD has such a nominations committee
whose members are independent under both the NYSE Listings Standards and the JSE Listings Requirements.

ITEM 16H. MINE SAFETY DISCLOSURES

Not applicable.

PART III

ITEM 17. FINANCIAL STATEMENTS

Not applicable.

ITEM 18. FINANCIAL STATEMENTS

The following annual financial statements and related auditor’s reports are filed as part of this Annual Report.

Page

Report of the Independent Registered Public Accounting Firm ........................................................................................

F-1

Consolidated statement of profit or loss and other comprehensive income for the years ended June 30, 2014, 2013

and 2012 ..........................................................................................................................................................................

F-2 to F-3

Consolidated statement of financial position at June 30, 2014 and 2013. .........................................................................

F-4

Consolidated statement of changes in equity for the years ended June 30, 2014, 2013 and 2012. ...................................

F-5

Consolidated statement of cash flows for the years ended June 30, 2014, 2013 and 2012. ..............................................

F-6

Notes to the financial statements. ......................................................................................................................................

F-7 to F-75

F-1

Report of the Independent Registered Public Accounting Firm

The Board of Directors and Stockholders of DRDGOLD Limited

We have audited the accompanying consolidated statements of financial position of DRDGOLD Limited and its subsidiaries as of
June 30, 2014 and 2013, and 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, 2014. We also have audited DRDGOLD Limited’s
internal control over financial reporting as of June 30, 2014, based on criteria established in Internal Control – Integrated Framework
(1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). DRDGOLD Limited’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 Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on these
consolidated financial statements and an opinion on DRDGOLD Limited’s internal control over financial reporting based on our
audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those
standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of
material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our
audits of the consolidated financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the
overall financial statement presentation. 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.

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.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of
DRDGOLD Limited and its subsidiaries as of June 30, 2014 and 2013, and the results of their operations and cash flows for each of
the years in the three-year period ended June 30, 2014, in conformity with International Financial Reporting Standards as issued by
the International Accounting Standards Board. Also in our opinion, DRDGOLD Limited maintained, in all material respects, effective
internal control over financial reporting as of June 30, 2014, based on criteria established in Internal Control – Integrated Framework
(1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

/s/ KPMG Inc
KPMG Inc
Johannesburg, Republic of South Africa
October 30, 2014

F-2

DRDGOLD Limited
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
for the year ended June 30, 2014

Continuing operations

Discontinued operations

Total operations

2014

2013

Restated

2012

Restated

2014

2013

Restated

2012

2014

2013

Restated

2012

Restated

Note

R'000

R’000

R'000

R’000

R'000

Revenue

1,809,434

2,076,496

1,764,191

1,240,073

1,809,434

2,076,496

3,004,264

Cost of sales

(1,687,270)

(1,639,377)

(1,400,268)

(1,101,594)

(1,687,270)

(1,639,377)

(2,501,862)

Operating costs

(1,598,300)

(1,497,439)

(1,231,020)

(1,061,770)

(1,598,300)

(1,497,439)

(2,292,790)

Depreciation

(159,999)

(143,766)

(119,189)

(1,661)

(159,999)

(143,766)

(120,850)

Retrenchment costs

(6,748)

(565)

(43,747)

(6,748)

(565)

(43,747)

Movement in provision for
environmental rehabilitation

86,605

(15,334)

(59,486)

301

86,605

(15,334)

(59,185)

Movement in gold in progress

(8,828)

122,164

17,727

9,427

5,283

(8,828)

17,727

14,710

Gross profit from operating
activities

437,119

363,923

138,479

122,164

437,119

502,402

Impairments

(56,591)

(187,866)

(1,100)

(56,591)

(187,866)

(1,100)

Administration expenses and
general costs

(78,120)

(64,549)

(122,672)

(10,918)

(78,120)

(64,549)

(133,590)

Results from operating
activities

(12,547)

184,704

240,151

127,561

(12,547)

184,704

367,712

Finance income

27,980

65,992

24,552

8,994

27,980

65,992

33,546

Finance expenses

(52,295)

(41,975)

(15,678)

(2,028)

(52,295)

(41,975)

(17,706)

Share of losses of equity
accounted investments

(313)

(50,135)

(313)

(50,135)

(Loss)/profit before taxation

(37,175)

158,586

249,025

134,527

(37,175)

158,586

383,552

Income tax

(17,548)

(54,723)

(60,928)

1,782

(17,548)

(60,928)

1,782

(Loss)/profit before loss on
disposal of discontinued
operation

97,658

250,807

134,527

(54,723)

97,658

385,334

Loss on disposal of discontinued
operations

(10,532)

(Loss)/profit for the year

(54,723)

97,658

250,807

123,995

(54,723)

97,658

374,802

Attributable to:
Equity owners of the parent

(45,808)

49,420

202,939

91,374

(45,808)

49,420

294,313

Non-controlling interest

(8,915)

48,238

47,868

32,621

(8,915)

48,238

80,489

(Loss)/profit for the year

(54,723)

97,658

250,807

123,995

(54,723)

97,658

374,802

The discontinued operations relate to the disposal of Blyvooruitzicht Gold Mining Company Limited (Blyvoor) on June 1, 2012.

F-3

DRDGOLD Limited
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME (continued)
for the year ended June 30, 2014

Continuing operations

Discontinued operations

Total operations

2014

2013

Restated

2012

Restated

2014

2013

Restated

2012

2014

2013

Restated

2012

Restated

Note

R'000

Other comprehensive income, net of tax
Items that are or may be reclassified to profit or loss

Net foreign exchange translation reserve

9,134

(3,999)

9,134

(3,999)

Foreign exchange profit/(loss) on translation

9,134

(3,999)

9,134

(3,999)

Net fair value adjustment on
available-for-sale investment

(51,626)

34,570

16,480

2,703

(51,626)

34,570

19,183

Fair value adjustment on available-for-sale
investment

(49,872)

(72,113)

20,572

2,328

(49,872)

(72,113)

22,900

Impairment of available-for-sale investment
reclassified to profit or loss

101,261

Non-controlling interest in fair value
adjustment on available-for-sale investment

(1,754)

951

379

375

(1,754)

951

754

Deferred taxation thereon

4,471

(4,471)

4,471

(4,471)

Net gain on disposal of available-for-sale
financial assets reclassified to profit or loss

(6,656)

Net gain on disposal of available-for-sale
financial assets

(4,925)

Non-controlling interest in net gain on
disposal of available-for-sale financial assets

(1,731)

Deferred taxation thereon

Total comprehensive income for the year

(106,349)

141,362

263,288

120,042

(106,349)

141,362

383,330

Attributable to:
Equity owners of the parent

(95,680)

92,173

215,040

88,777

(95,680)

92,173

303,817

Non-controlling interest

(10,669)

49,189

48,248

31,265

(10,669)

49,189

79,513

Total comprehensive income for the year

(106,349)

141,362

263,288

120,042

(106,349)

141,362

383,330

Earnings per share attributable to equity
owners of the parent

Basic (loss)/earnings per share (cents)

(12)

Diluted (loss)/earnings per share
(cents)

(12)

The accompanying notes are an integral part of these consolidated financial statements.

The discontinued operations relate to the disposal of Blyvooruitzicht Gold Mining Company Limited (Blyvoor) on June 1, 2012.

F-4

DRDGOLD Limited
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
at June 30, 2014

2014

2013

Restated

Note

R’000

ASSETS
Non-current assets

1,970,344

2,064,676

Property, plant and equipment

1,755,503

1,756,333

Non-current investments and other assets

213,417

305,141

Equity accounted investments

313

Deferred tax asset

1,424

2,889

Current assets

470,402

604,324

Inventories

147,189

138,847

Trade and other receivables

99,523

82,734

Current tax asset

5,885

6,092

Cash and cash equivalents

208,932

376,651

Assets held-for-sale

8,873

Total assets

2,440,746

2,669,000

EQUITY AND LIABILITIES
Equity

1,481,211

1,643,672

Equity of the owners of the parent

1,249,071

1,400,863

Non-controlling interest

232,140

242,809

Non-current liabilities

652,062

782,730

Provision for environmental rehabilitation

451,203

524,323

Post-retirement and other employee benefits

9,275

8,653

Deferred tax liability

116,084

106,422

Loans and borrowings

75,500

143,332

Current liabilities

307,473

242,598

Trade and other payables

211,790

217,286

Loans and borrowings

73,195

24,294

Post-retirement and other employee benefits

1,958

1,018

Liabilities held-for-sale

20,530

Total liabilities

959,535

1,025,328

Total equity and liabilities

2,440,746

2,669,000

The accompanying notes are an integral part of these consolidated financial statements.

F-5

DRDGOLD Limited
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the year ended June 30, 2014

Number

ordinary

shares

Number of

cumulative

preference

shares

Share capital

R’000

Cumulative

preference

share

capital

R’000

Revaluation

and other

reserves

R’000

Retained

earnings

R’000

Equity of the

owners of the

parent

R’000

Non-

controlling

interest

R’000

Total equity

R’000

Balance at June 30, 2011 reported previously

384,884,379

5,000,000

4,132,604

500

203,349

(3,089,215)

1,247,238

(28,072)

1,219,166

Impact of the change in accounting policies (refer note 1)

(2,035)

2,035

Balance at July 1, 2011 restated

384,884,379

5,000,000

4,132,604

500

203,349

(3,091,250)

1,245,203

(26,037)

1,219,166

Staff options exercised

499,388

1,818

Share issue expense

(555)

Share-based payments

4,133

Non-controlling interest on disposal of subsidiary

97,496

Transfer of reserves on disposal of subsidiary

(11,469)

11,469

Treasury shares acquired through subsidiary

(58,228)

Treasury shares disposed of by subsidiary

13,478

Dividend on ordinary share capital

(28,872)

Restated total comprehensive income for the year²

9,062

294,755

303,817

79,513

383,330

Balance at June 30, 2012 Restated

385,383,767

5,000,000

4,089,117

500

205,075

(2,813,898)

1,480,794

150,972

1,631,766

Share issue expenses

(180)

Share-based payments

1,166

Share option buy-out

(24,052)

Non-controlling interest on disposal of subsidiary

(58,384)

58,384

Treasury shares disposed of by subsidiary

350

Dividend on ordinary share capital

(91,004)

(15,736)

(106,740)

Restated total comprehensive income for the year²

42,753

49,420

92,173

49,189

141,362

Balance at June 30, 2013 Restated

385,383,767

5,000,000

4,089,287

500

224,942

(2,913,866)

1,400,863

242,809

1,643,672

Share issue expenses

(1,060)

Share-based payments

520

Share option buy-out

(2,734)

Treasury shares disposed of by subsidiary

247

Dividend on ordinary share capital

(53,085)

Total comprehensive income for the year²

(49,872)

(45,808)

(95,680)

(10,669)

(106,349)

Balance at June 30, 2014

385,383,767

5,000,000

4,088,474

500

172,856

(3,012,759)

1,249,071

232,140

1,481,211

The accompanying notes are an integral part of these consolidated financial statements.

Revaluation and other reserves comprise share-based payment reserves, foreign currency translation reserve (arises on the translation of a foreign joint venture in Zimbabwe) and asset revaluation reserves.

² Refer to the consolidated statement of profit or loss and other comprehensive income for a detailed analysis of total comprehensive income for the year.

F-6

DRDGOLD Limited
CONSOLIDATED STATEMENT OF CASH FLOWS
for the year ended June 30, 2014

2014

2013

Restated

2012

Restated

Note

R’000

CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from sales of precious metals

1,814,219

2,076,496

3,004,264

Cash paid to suppliers and employees

(1,726,835)

(1,634,175)

(2,392,714)

Cash generated by operations

87,384

442,321

611,550

Finance income

16,359

27,337

18,243

Dividends received

32,470

Finance expenses

(16,838)

(4,097)

(3,382)

Income tax (paid)/received

(6,214)

4,185

(5,275)

Net cash inflow from operating activities

80,691

502,216

621,170

CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of non-current investments and other assets

(7)

(58,292)

(55,497)

Cash flow on disposal of investments

1,839

Additions to property, plant and equipment

(158,593)

(368,478)

(319,097)

Advance to equity accounted investment

(13,946)

(14,549)

Proceeds on disposal of property, plant and equipment

992

31,970

12,470

Environmental rehabilitation payments

(14,170)

(22,476)

(19,766)

Cash flow on disposal of subsidiaries, net of cash disposed

(9,584)

Net cash outflow from investing activities

(171,778)

(429,383)

(406,023)

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from the issue of shares

1,818

Share issue expenses

(1,060)

(180)

(555)

Acquisition of treasury shares

(58,228)

Proceeds on disposal of treasury shares

247

350

13,478

Advances of loans and borrowings

163,332

Repayments of loans and borrowings

(20,000)

(30,690)

(96,194)

Share option buy-out

(2,734)

(24,052)

Dividends paid

(53,085)

(103,063)

(28,872)

Net cash (outflow)/inflow from financing activities

(76,632)

5,697

(168,553)

NET (DECREASE)/INCREASE IN CASH AND CASH
EQUIVALENTS

78,530

46,594

Cash and cash equivalents at beginning of the year

376,651

(167,719)

298,035

251,383

Foreign exchange movements

Cash and cash equivalents at the end of the year

208,932

376,651

298,035

The accompanying notes are an integral part of these consolidated financial statements.

F-7

NOTES TO THE FINANCIAL STATEMENTS
for the year ended June 30, 2014

1. ACCOUNTING POLICIES

REPORTING ENTITY

DRDGOLD Limited (the company) is domiciled in South Africa. These consolidated financial statements comprise the company,
its subsidiaries (collectively the “group” and individually “group companies”) and interest in equity accounted investments.

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), SAICA Financial Reporting Guides as
issued by the Accounting Practices Committee and Financial Reporting Pronouncements as issued by the Financial Reporting
Standards Council as well as the requirements of the Companies Act of South Africa.

The consolidated financial statements were approved by the board of directors on September 30, 2014.

Details of the group’s accounting policies are outlined in this note.

FUNCTIONAL AND PRESENTATION CURRENCY

The consolidated financial statements are presented in South African rands, which is the company's functional currency. All
financial information presented in South African rands has been rounded to the nearest thousand, unless otherwise stated.

USE OF ESTIMATES AND JUDGMENTS

The preparation of the consolidated financial statements in conformity with the IFRS, requires management to make judgements,
estimates and assumptions that affect the application of accounting policies and reported amounts of assets and liabilities, income
and expenses.

The estimates and associated assumptions are based on historical experience and various other factors that are believed to be
reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets
and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in
the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future
periods if the revision affects both current and future periods.

Information about critical judgements in applying accounting policies that have the most significant effect on the amounts
recognised in the consolidated financial statements is outlined below:

(a) Recoverable amount of mining assets and depreciation

The recoverable amounts of mining assets are determined using discounted future cash flows. Management also
considers such factors as the market capitalisation of the group, the quality of the individual ore body and the country
risk in determining the recoverable amount. During the year under review, the group calculated a recoverable amount
based on updated life-of-mine plans, a gold price of R453 121 a kilogram (2013: R410 473 a kilogram) in year one
escalating at an average of 7.2% (2013: 6.7%) a year, and a discount rate of 26.3%. At a 10% lower gold price received,
a R894.2 million impairment would be recognised and at a 4.7 percentage points (18%) increase in the discount rate to
31.0%, the group would begin impairment of the mining assets (refer to note 9).

The calculation of the units-of-production rate of depreciation could be affected if actual production in the future is
different from current forecast production based on proved and probable mineral reserves. This would generally arise
when there are significant changes in any of the factors or assumptions used in estimating mineral reserves.

Factors could include:
• changes in proved and probable mineral reserves;
• the grade of mineral reserves may vary significantly from time to time;
• differences between actual commodity prices and commodity price assumptions;
• unforeseen operational issues at mine sites;
• changes in capital, operating, mining processing and reclamation costs, discount rates and foreign exchange rates; and
• changes in mineral reserves which could similarly affect the useful lives of assets depreciated on the straight-line basis,

where those lives are limited to the life of the mine.

F-8

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

1. ACCOUNTING POLICIES (continued)

USE OF ESTIMATES AND JUDGMENTS (continued)

(b) Valuation of financial instruments

If the value of a financial instrument cannot be obtained from an active market, the group has established fair value by
using valuation techniques. These include the use of net asset values of investees, recent arm’s-length transactions,
reference to other instruments that are substantially the same and discounted cash flow analysis and option pricing
models, refined to reflect the issuer’s specific circumstances.

(c) Estimate of exposure and liabilities with regard to rehabilitation costs

Estimated provisions for environmental rehabilitation, comprising pollution control rehabilitation and mine closure, are
based on the group’s environmental management plans in compliance with current technological, environmental and
regulatory requirements.

An average discount rate of 8.3% (2013: 7.6%), average inflation rate of 6.0% (2013: 5.4%) and expected life-of-mine
according to the life-of-mine plans were used in the calculation of the estimated net present value of the rehabilitation
liability (refer to note 17).

(d) Estimate of tax

The group is subject to income tax in South Africa and Zimbabwe. Significant judgement is required in determining
income taxes. There are many transactions and calculations for which the ultimate tax determination is uncertain during
the ordinary course of business. The group recognises liabilities for anticipated tax issues based on estimates of whether
additional taxes will be due. Where the final tax outcome of these matters is different from the amounts that were
initially recorded, such differences will have an impact on the income tax and deferred tax provisions in the period in
which such determination is made.

(e) Fair value of share-based compensation

The fair value of options granted is determined using the Black-Scholes option pricing model. The significant inputs into
the model are: vesting period and conditions, risk-free interest rate, volatility, market price on date of grant and issue
price of grant. Other inputs are: performance criteria and employee retention rate (refer to note 18 for detail on the share
option scheme and phantom share scheme).

(f) Gold in lock-up

Gold in lock-up in certain plants is estimated based on the metallurgist’s best estimate of the gold content and grade
thereof.

(g) Assessment of contingencies

Contingencies will realize only when one or more future events occur or fail to occur. The exercise of significant
judgment and estimates of the outcome of future events are required during the assessment of the impact of such
contingencies.

(h) Mineral Reserves estimates

At the end of each financial year, the estimate of proved and probable Mineral Reserves is updated. Depreciation of
mining assets is prospectively adjusted, based on these changes.

Mineral Reserves are estimates of the amount of product that can be economically and legally extracted from the group’s
properties. In order to calculate mineral reserves, 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.

F-9

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

1. ACCOUNTING POLICIES (continued)

USE OF ESTIMATES AND JUDGMENTS (continued)

(h) Mineral Reserves estimates (continued)

Estimating the quantity and/or grade of mineral reserves requires the size, shape and depth of ore bodies to be
determined by analyzing geological data such as the logging and assaying of drill samples. This process may require
complex and difficult geological judgments and calculations to interpret the data.

The group is required to determine and report mineral reserves in accordance with the South African Code for the

Reporting of Exploration Results, Mineral Resources and Mineral Reserves (SAMREC Code).

Because the economic assumptions used to estimate mineral reserves change from period to period and because
additional geological data is generated during the course of operations, estimates of mineral reserves may change from
period to period. Changes in reported mineral reserves may affect the group’s 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, depletion and amortization charged in profit or loss may change where such charges are determined
  by the units-of-production method, or where the useful economic lives of assets change;
· decommissioning, site restoration and environmental provisions may change where changes in estimated mineral
  reserves affect expectations about the timing or cost of these activities; and
· the carrying value of deferred tax assets may change due to changes in estimates of the likely recovery of the tax
  benefits.

These adjustments are made prospectively where relevant.

(i) Estimate of deferred tax

The amount recognised as a deferred tax asset is generally determined using discounted future cash flows aligned to
estimates used in the calculation of depreciation and rehabilitation liabilities. Management considers all factors that
could possibly affect the probability that future taxable profit will be available against which unused tax credits can be
utilised. These factors include profitability of operations and an estimate of the gold price. The amount recognised as a
deferred tax asset is sensitive to the current gold spot price. The amount recognised at June 30, 2014 is based on a future
gold price received of R453 121 a kilogram (2013: R410 473 a kilogram) in year one, escalating at an average of 7.2%
(2013: 6.7%) a year.

(j) Measurement of fair values

A number of the group’s accounting policies and disclosures require the measurement of fair values, for both

financial and non-financial assets and liabilities.

Management regularly reviews significant unobservable inputs and valuation adjustments.

If third party information, such as broker quotes or pricing services, is used to measure fair values, then the valuation

team assesses the evidence obtained from the third parties to support the conclusion that such valuations meet the

requirements of IFRS, including the level in the fair value hierarchy in which such valuations should be classified.

Significant valuation issues are reported to the group audit and risk committee.

When measuring the fair value of an asset or a liability, the group uses market observable data as far as possible. Fair

values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation as follows.

• Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.

• Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either

directly (i.e. as prices) or indirectly (i.e. derived from prices).

• Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

If the inputs used to measure the fair value of an asset or a liability might be categorised in different levels of the fair

value hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value hierarchy

as the lowest level input that is significant to the entire measurement.

F-10

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

1. ACCOUNTING POLICIES (continued)

USE OF ESTIMATES AND JUDGMENTS (continued)

The group recognises transfers between levels of the fair value hierarchy at the end of the reporting period during which

the change has occurred.

Further information about the assumptions made in measuring fair values is included in note 25.

BASIS OF MEASUREMENT
The financial statements are prepared on the historical cost basis, unless otherwise stated.

CHANGES IN ACCOUNTING POLICIES
Except for the changes below, the group has consistently applied the accounting policies set out below to all periods presented in
these consolidated financial statements.

NEW STANDARDS, INTERPRETATIONS AND AMENDMENTS TO STANDARDS AND INTERPRETATIONS NOT
APPLICABLE
The following new standards, amendments to standards and interpretations with a date of initial application of July 1, 2013 are
not applicable to the group:

IAS 28 – investments in associates and joint ventures
IAS 28 (2012) supersedes IAS 28 (2008) and makes the following amendments:
• IFRS 5 applies to an investment, or a portion of an investment, in an associate or a joint venture that meets the criteria to be

classified as held-for-sale; and

• on cessation of significant influence or joint control, even if an investment in an associate becomes an investment in a joint

venture or vice versa, the entity does not remeasure the retained interest.

Amendments to IFRS 7 – financial instruments: disclosures: offsetting financial assets and financial liabilities
The amendments contain new disclosure requirements for financial assets and financial liabilities that are offset in the statement
of financial position, or are subject to enforceable master netting arrangements or similar agreements. Where the group applies
offsetting in the financial statements, it will be required to provide additional disclosures in this regard.

IFRIC 20 – stripping costs in the production phase of a surface mine
The interpretation sets out principles for the recognition of production stripping costs in the statement of financial position. It is
recognised that some production stripping in surface mining activity will benefit production in future periods and sets out criteria
for capitalising such costs.

NEW STANDARDS, INTERPRETATIONS AND AMENDMENTS TO STANDARDS AND INTERPRETATIONS
ADOPTED
The group adopted the following new standards, amendments to standards and interpretations, which are applicable to the group,
with a date of initial application of July 1, 2013:

IFRS 10 (2011) – consolidated financial statements, IFRS 11 – joint arrangements, IFRS 12 – disclosures of interests in
other entities
IFRS 10 (2011) introduces a single control model to determine whether an investee should be consolidated. The new standard
changes the definition of control such that an investor controls an investee when it is exposed, or has rights, to variable returns
from its involvement with the investee and has the ability to control those returns through its power over the investee.

Under IFRS 11, the structure of the joint arrangement, although still an important consideration, is no longer the major factor in
determining the type of joint arrangement and therefore the subsequent accounting.
• The group’s interest in a joint operation, which is an arrangement in which the parties have rights to the assets and obligations

for the liabilities, will be accounted for on the basis of the group’s interest in those assets and liabilities.

• The group’s interest in a joint venture which is an arrangement in which the parties have rights to the net assets, will be equity

accounted.

IFRS 12 brings together in a single standard all the disclosure requirements about an entity’s interests in subsidiaries, joint
arrangements, associates and unconsolidated structured entities. IFRS 12 requires the disclosure of information about the nature,
risks and financial effects of these interests. As a result of IFRS 12, the group has expanded its disclosure about its interests in
subsidiaries (refer note 11) and equity accounted investments (refer note 12).

F-11

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

1. ACCOUNTING POLICIES (continued)

NEW STANDARDS, INTERPRETATIONS AND AMENDMENTS TO STANDARDS AND INTERPRETATIONS
ADOPTED (continued)

IFRS 13 – fair value measurement
IFRS 13 establishes a single framework for measuring fair value and making disclosures about fair value measurements when
such measurements are required or permitted by other IFRSs. It unifies the definition of fair value as the price that would be
received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement
date. It replaces and expands the disclosure requirements about fair value measurements in other IFRSs, including IFRS 7. As a
result, the group has included additional disclosures in this regard (refer note 26).

In accordance with the transitional provisions of IFRS 13, the group has applied the new fair value measurement guidance
prospectively and has not provided any comparative information for new disclosures. Notwithstanding the above, the change had
no impact on the measurements of the groups’ assets and liabilities.

IAS 19 amended 2012 – employee benefits
The amended IAS 19 includes the following requirements:
• actuarial gains and losses are recognised immediately in other comprehensive income; this change will remove the corridor

method and eliminate the ability for entities to recognise all changes in the defined benefit obligation and in plan assets in profit
or loss, which currently is allowed under IAS 19; and

• expected return on plan assets recognised in profit or loss is calculated based on the rate used to discount the defined benefit

obligation.

No actuarial gains or losses were recognised by the group in the current or preceding financial year due to no actuarial valuation
being performed. Future actuarial gains or losses that may result from future actuarial valuations will be recognised immediately
in other comprehensive income.

Impact of changes in accounting policies
Other than outlined below, these standards, amendments to standards and interpretations did not have any effect on the financial
position or financial performance of the group.

i) The group has adopted IFRS11 – Joint Arrangements with an effective date of July 1, 2013. The group’s previous accounting
policy was to proportionately consolidate investments in joint arrangements. With the adoption of IFRS 11 – Joint Arrangements
the group applies equity accounting and have retrospectively restated the comparative information. The group re-evaluated its
involvement in its joint arrangement and the investee continues to be classified as a joint venture.

ii) The group has adopted IFRS 10 Consolidated Financial Statements and has reassessed the control conclusion for its investees
at July 1, 2013. The group’s previous accounting policy was to consolidate the Guardrisk Cell Captive as a special purpose entity
(SPE) on a line by line basis. With the adoption of IFRS 10 Consolidated Financial Statements the Guardrisk Cell Captive is not
considered to be controlled by the group and is therefore not consolidated with an effective date of July 1, 2013.

The Cell Captive cell # 170, to which DRDGOLD is a shareholder, holds funds that may be applied only towards the settlement
of the DRDGOLD group’s environmental rehabilitation obligations under financial guarantees issued by Guardrisk Insurance
Company Limited to the Department of Mineral Resources (DMR). The group is therefore considered to have a right to the funds
held in the Guardrisk Cell Captive and therefore recognised a reimbursive right to these funds in the hands of Ergo under IFRIC 5
Interest arising from Decommissioning, Restoration and Environmental Rehabilitation Funds.

The consolidated statement of financial position at June 30, 2013, the statements of profit or loss and other comprehensive
income, statements of changes in equity and statements of cash flows for the 2 years then ended respectively, have been restated
with the effects of IFRS 10, IFRIC 5 and IFRS 11 where relevant.

F-12

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

1. ACCOUNTING POLICIES (continued)

NEW STANDARDS, INTERPRETATIONS AND AMENDMENTS TO STANDARDS AND INTERPRETATIONS
ADOPTED (continued)

Impact of changes in accounting policies (continued)

Adjustments to the consolidated statements of financial position

As stated

previously

IFRS 10 and

IFRIC 5

IFRS 11

Restated

R’000

At June 30, 2013

Non-current investments and other assets

307,070

(1,929)

–

305,141

Equity accounted investments

–

313

Trade and other receivables

82,745

(11)

–

82,734

Cash and cash equivalents

377,169

–

(518)

376,651

Other assets

1,904,161

–

1,904,161

Total assets

2,671,145

(1,940)

(205)

2,669,000

Deferred tax liability

100,765

5,657

–

106,422

Trade and other payables

220,491

(3,000)

(205)

217,286

Other liabilities

701,620

–

701,620

Total liabilities

1,022,876

2,657

(205)

1,025,328

Equity of the owners of the parent

1,427,035

(26,172)

–

1,400,863

Non-controlling interest

221,234

21,575

–

242,809

Equity

1,648,269

(4,597)

–

1,643,672

At June 30, 2012

Property, plant and equipment

1,641,557

–

(26 984)

1,614,573

Non-current investments and other assets

341,752

(1,842)

–

339,910

Equity accounted investments

–

27 368

27,368

Trade and other receivables

61,896

(675)

(679)

60,542

Cash and cash equivalents

298,506

–

(471)

298,035

Other assets

148,578

–

148,578

Total assets

2,492,289

(2,517)

(766)

2,489,006

Deferred tax liability

87,032

2,542

–

89,574

Trade and other payables

227,511

(2,904)

(766)

223,841

Other liabilities

543,825

–

543,825

Total liabilities

858,368

(362)

(766)

857,240

Equity of the owners of the parent

1,497,192

(16,398)

–

1,480,794

Non-controlling interest

136,729

14,243

–

150,972

Equity

1,633,921

(2,155)

–

1,631,766

At July 1, 2011

Non-current investments and other assets

159,312

7,729

–

167,041

Cash and cash equivalents

259,112

(7,729)

–

251,383

Other assets

1,870,237

–

1,870,237

Total assets

2,288,661

–

2,288,661

Equity of the owners of the parent

1,247,238

(2,035)

–

1,245,203

Non-controlling interest

(28,072)

2,035

–

(26,037)

Equity

1,219,166

–

1,219,166

F-13

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

1. ACCOUNTING POLICIES (continued)

NEW STANDARDS, INTERPRETATIONS AND AMENDMENTS TO STANDARDS AND INTERPRETATIONS
ADOPTED (continued)

Impact of changes in accounting policies (continued)

Adjustments to the consolidated statement of profit or loss and other comprehensive income

Year ended June 30, 2013

Year ended

June 30, 2013

as stated

previously

IFRS 10

IFRS 11

Year ended

June 30, 2013

Restated

and

IFRIC 5

R’000

Impairments

(238,001)

–

50,135

(187,866)

Administration expenses and general costs

(78,070)

13,521

–

(64,549)

Results from operating activities

121,048

13,521

50,135

184,704

Finance income

65,968

–

65,992

Share of losses of equity accounted investments

–

(50,135)

Profit before tax

145,041

13,545

–

158,586

Income tax

(44,941)

(15,987)

–

(60,928)

Profit before loss on disposal of discontinued operation

100,100

(2,442)

–

97,658

Profit for the year

100,100

(2,442)

–

97,658

Attributable to:

Equity owners of the parent

59,194

(9,774)

–

49,420

Non-controlling interest

40,906

7,332

–

48,238

Total comprehensive income for the year

143,804

(2,442)

–

141,362

Attributable to:

Equity owners of the parent

101,947

(9,774)

–

92,173

Non-controlling interest

41,857

7,332

–

49,189

Earnings per share attributable to equity owners of
the parent

Basic earnings per share (cents)

(3)

–

Diluted basic earnings per share (cents)

(3)

–

Adjustments to the consolidated statement of cash flows

Year ended June 30, 2013

Year ended

June 30, 2013

as stated

previously

IFRS 10

IFRS 11

Year ended

June 30, 2013

Restated

and

IFRIC 5

R’000

Net cash inflow from operating activities

502,263

–

(47)

502,216

Net cash outflow from investing activities

(429,383)

–

(429,383)

Additions to property, plant and equipment

(382,424)

–

13 946

(368,478)

Advance to equity accounted investment

–

(13 946)

(13,946)

Other net cash flows from investing activities

(46,959)

–

(46,959)

Net cash inflow from financing activities

5,697

–

5,697

Net increase in cash and cash equivalents

78,577

–

(47)

78,530

Cash and cash equivalents at the beginning of the year

298,506

–

(471)

298,035

Foreign exchange movements

–

Cash and cash equivalents at the end of the year

377,169

–

(518)

376,651

F-14

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

1. ACCOUNTING POLICIES (continued)

NEW STANDARDS, INTERPRETATIONS AND AMENDMENTS TO STANDARDS AND INTERPRETATIONS
ADOPTED (continued)

Impact of changes in accounting policies (continued)

Adjustments to the consolidated statement of profit or loss and other comprehensive income

Year ended June 30, 2012

Year ended

June 30, 2012

as stated

previously

IFRS 10

IFRS 11

Year ended

June 30, 2012

Restated

and

IFRIC 5

R’000

Administration expenses and general costs

(121,537)

(12,053)

–

(133,590)

Results from operating activities

379,765

(12,053)

–

367,712

Finance income

33,440

106

–

33,546

Profit before tax

395,499

(11,947)

–

383,552

Income

tax

(8,010)

9,792

–

1,782

Profit before loss on disposal of discontinued operation

387,489

(2,155)

–

385,334

Profit for the year

376,957

(2,155)

–

374,802

Attributable to:

Equity owners of the parent

308,675

(14,362)

–

294,313

Non-controlling interest

68,282

12,207

–

80,489

Total comprehensive income for the year

385,485

(2,155)

–

383,330

Attributable to:

Equity owners of the parent

318,180

(14,363)

–

303,817

Non-controlling interest

67,305

12,208

–

79,513

Earnings per share attributable to equity owners of
the parent

Basic earnings per share (cents)

(3)

–

Diluted basic earnings per share (cents)

(3)

–

Adjustments to the consolidated statement of cash flows

Year ended June 30, 2012

Year ended

June 30, 2012

as stated

previously

IFRS 10

IFRS 11

Year ended

June 30, 2012

Restated

And

IFRIC 5

R’000

Net cash inflow from operating activities

621,170

–

621,170

Cash generated by operations

623,583

(12,033)

–

611,550

Income tax (paid)

(17,308)

12,033

–

(5,275)

Other net cash flows from operating activities

14,895

–

14,895

Net cash outflow from investing activities

(413,281)

7,729

(471)

(406,023)

Additions to property, plant and equipment

(333,175)

–

14,078

(319,097)

Advance to equity accounted investment

–

(14,549)

Acquisition of non-current investments and other

assets

(63,226)

7,729

–

(55,497)

Other net cash flows from investing activities

(16,880)

–

(16,880)

Net cash inflow from financing activities

(168,553)

–

(168,553)

Net increase in cash and cash equivalents

39,336

7,729

(471)

46,594

Cash and cash equivalents at the beginning of the year

259,112

(7,729)

–

251,383

Foreign exchange movements

–

Cash and cash equivalents at the end of the year

298,506

–

(471)

298,035

F-15

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

1. ACCOUNTING POLICIES (continued)

BASIS OF CONSOLIDATION

Non-controlling interests (NCI)
NCI are measured at their proportionate share of the acquiree’s identifiable net assets at the acquisition date.

Changes in the group’s interest in a subsidiary which do not lead to loss of control are accounted for as equity transactions with
equity owners in their capacity as equity owners and no profit or loss is recognised.

In the absence of an agreement with non-controlling interest shareholders, losses in subsidiaries are allocated to non-controlling
interests even if doing so causes the non-controlling interest to have a deficit balance.

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.

Loss of control
When the group loses control over a subsidiary, it derecognises the assets and liabilities of the subsidiary, and any related NCI
and other components of equity. Any resulting gain or loss is recognised in profit or loss. Any interest retained in the former
subsidiary is measured at the fair value when control is lost, which is deemed to be the cost price, and, depending on the nature of
the remaining investment, is either recognised as an associate, joint venture or as a financial instrument.

Interest in equity accounted investments
The group’s interest in equity accounted investments comprises interests in an associate and a joint venture.

Associates are those entities in which the group has significant influence, but not control or joint control, over the financial and
operating policies. A joint venture is an arrangement in which the group has joint control, whereby the group has rights to the net
assets of the arrangement, rather than rights to its assets and obligations for its liabilities.

Interest in associates and joint ventures are accounted for using the equity method. They are initially recognised at cost, which
includes transaction costs. Subsequent to initial recognition, the consolidated financial statements include the group’s share of
profit or loss and OCI of equity accounted investees, until the date on which significant influence or joint control ceases. Any
losses from associates and joint ventures are brought to account in the consolidated financial statements until the interest in such
associates and joint ventures are written down to zero. Thereafter, losses are accounted for only insofar as the group is committed
to providing financial support to such associates and joint ventures.

Significant influence is presumed to exist when the group holds between 20% and 50% of the voting power of another entity.

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. Unrealised gains arising from transactions with
equity accounted investments are eliminated against the investment to the extent of the group’s interest in the investee. Unrealised
losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.

Acquisitions from entities under common control
Business combinations arising from transfers of interests in entities that are under the control of the shareholder which controls
the group are accounted for as if the acquisitions had occurred at the beginning of the earliest comparative year presented or, if
later, at the date that common control was established. For this purpose comparatives are restated. The assets and liabilities
acquired are recognised at the carrying amounts recognised previously in the group controlling shareholder’s consolidated
financial statements. Any excess (shortfall) of the purchase consideration over the net asset value acquired is recognised in equity
as a notional distribution to (contribution by) owners.

F-16

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

1. ACCOUNTING POLICIES (continued)

FOREIGN CURRENCY

Foreign currency transactions

Transactions in foreign currencies undertaken by group entities are translated to the functional currency at the exchange rates
ruling at the dates of these transactions. Monetary assets and liabilities denominated in foreign currencies are translated to the
functional currency at the exchange rate at the reporting date. Non-monetary assets and liabilities that are measured at historical
cost are translated using the exchange rate at the date of the transaction. Non-monetary assets and liabilities denominated in
foreign currencies, measured at fair value, are translated at foreign exchange rates ruling at the date that the fair value was
determined. Foreign exchange differences arising on translation are recognised in profit or loss.

Foreign currency differences arising from the translation of available-for-sale equity investments (except on impairment in which
case the foreign currency differences that have been recognised in OCI are reclassified to profit or loss) are recognised in OCI.

Foreign operations

The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, are translated
into South African rands at the exchange rates at the reporting date. The income and expenses of foreign operations are translated
to South African rands at exchange rates at the dates of the transactions. Foreign exchange differences arising on retranslation are
recognised in other comprehensive income and accumulated within equity in the foreign currency translation reserve. When a
foreign operation is disposed of, the relevant amount in the foreign currency translation reserve is transferred to profit or loss as
part of the profit or loss on disposal. On partial disposal of a subsidiary that includes a foreign operation, the relevant portion of
such cumulative amount is reattributed to non-controlling interest.

Net investment in foreign operations

Foreign exchange gains and losses arising from a monetary item receivable from or payable to a foreign operation, the settlement
of which is neither planned nor likely in the foreseeable future, are considered to form part of a net investment in a foreign
operation and are recognised in other comprehensive income and presented within equity in the foreign currency translation
reserve in the consolidated financial statements.

FINANCIAL INSTRUMENTS

The entity classifies non-derivative financial assets into the following categories: financial assets at fair value through profit or
loss, held-to-maturity financial assets, loans and receivables and available-for-sale financial assets.

The entity classifies non-derivative financial liabilities into the financial liabilities measured at amortised cost category.

(i) Non derivative financial assets and financial liabilities – recognition and derecognition

The entity initially recognises loans and receivables on the date when they are originated. All other financial assets and financial
liabilities are initially recognised on the trade date.

Financial assets are derecognised when the contractual rights to the cash flows from the financial asset expire or to the extent that
the group transfers substantially all the risks and rewards of ownership of the financial asset. Any interest in such derecognised
financial assets that is created or retained by the entity is recognised as a separate asset or liability.

Financial liabilities are derecognised when the obligation specified in the contract is discharged or cancelled or has expired. Any
gain or loss on derecognition is taken to profit or loss.

Financial assets and financial liabilities are offset and the net amount presented in the statement of financial position when, and
only when, the entity has a legal right to offset the amounts and intends either to settle them on a net basis or to realise the asset
and settle the liability simultaneously.

(ii) Non derivative financial assets – measurement

Loans and receivables

These assets are initially recognised at fair value plus any directly attributable transaction costs. Subsequent to initial recognition,
they are measured at amortised cost using the effective interest method less any impairment losses.

F-17

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

1. ACCOUNTING POLICIES (continued)

FINANCIAL INSTRUMENTS (continued)

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand, demand deposits, and highly liquid investments which are readily convertible
to known amounts of cash and subject to insignificant risk of changes in value. Subsequent to initial recognition, cash and cash
equivalents are measured at amortised cost, which is equivalent to their fair value. Bank overdrafts that are repayable on demand
and form an integral part of the group’s cash management are included as a component of cash and cash equivalents for the
purpose of the statement of cash flows.

Cash and cash equivalents include restricted cash and are short-term in nature. Restricted cash which is long-term in nature is
classified as non-current and is similar in nature to rehabilitation trust funds. Restricted cash would typically be long-term in
nature when it is expected not to be able to be utilised for at least 12 months after the reporting date.

Available-for-sale financial assets

The group’s investments in equity securities and certain debt 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 other comprehensive income and accumulated in the fair value reserve. When these assets are derecognised, the gain or loss
accumulated in equity is reclassified to profit or loss.

(iii) Non-derivative financial liabilities – measurement

Non-derivative financial liabilities are initially recognised at fair value less any directly attributable transaction costs. Subsequent
to initial recognition, these liabilities are measured at amortised cost using the effective interest method.

PROPERTY, PLANT AND EQUIPMENT

Recognition and measurement

The group’s property, plant and equipment consist mainly of mining assets which comprise mining properties (including mineral
rights), mine development costs, mine plant facilities, exploration assets and vehicles.

Items of property, plant and equipment are measured at cost, less accumulated depreciation and accumulated impairment losses.

Development costs, which are capitalised, consist primarily of expenditure that gives access to proved and probable mineral
reserves.

Capitalised development costs include expenditure incurred to develop new ore bodies, to define future mineralisation in existing
ore bodies and to expand the capacity of a mine. Mine development costs to maintain production are expensed as incurred. Where
funds have been borrowed specifically to finance a project, the amount of interest capitalised represents the actual borrowing
costs incurred (refer to accounting policy on borrowing costs capitalised). Mine development costs capitalised, include acquired
proved and probable mineral reserves at the acquisition date.

Exploration and evaluation costs, including the costs of acquiring licences, property and qualifying borrowing costs, are
capitalised as exploration assets on a project-by-project basis, pending determination of the technical feasibility and commercial
viability of the project. The capitalised costs are presented as tangible assets according to the nature of the assets acquired. When
a licence is relinquished or a project is abandoned, the related costs are recognised in profit or loss immediately. Pre-licence costs
are recognised in profit or loss as incurred.

Cost includes expenditure that is directly attributable to the acquisition of the asset. The cost of self-constructed assets includes
the cost of materials and direct labor, any other costs directly attributable to bringing an asset to a working condition for its
intended use, as well as the costs of dismantling and removing an asset and restoring the site on which it is located.

Where parts of an item of property, plant and equipment, with costs that are significant in relation to the total cost of the item,
have different useful lives, they are accounted for as separate items of property, plant and equipment.

F-18

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

1. ACCOUNTING POLICIES (continued)

PROPERTY, PLANT AND EQUIPMENT (continued)

Any gains or losses on disposal of an item of property, plant and equipment are determined by comparing the net proceeds from
disposal with the carrying amount of property, plant and equipment and are recognised in profit or loss. When assets are sold
which have been revalued on acquisition for consolidation purposes, the amounts included in the revaluation reserve are
transferred to retained earnings (refer to note 16).

Subsequent expenditure

The group recognises in the carrying amount of an item of property, plant and equipment, the cost of replacing part of an item
when that cost is incurred, if it is probable that the future economic benefits embodied within the part will flow to the group and
the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognised. All other costs are
recognised in profit or loss as an expense as incurred.

Depreciation

Depreciation of mining properties (including mineral rights), mine development and mine plant facilities are computed using the
units-of-production method based on estimated proved and probable mineral reserves, which are calculated using the group’s life-
of-mine business plans and a gold price at the end of each financial year. Proved and probable mineral reserves reflect estimated
quantities of economically recoverable reserves which can be recovered in the future from known mineral deposits.

Exploration assets that are available for use are depreciated over their estimated useful lives. Changes in management’s estimates
of the quantities of the economically recoverable reserves impact depreciation on a prospective basis.

Other assets are depreciated using the straight-line basis over the estimated useful lives of each part of an item of property, plant
and equipment. Leased assets are depreciated over the shorter of the lease term and their estimated useful lives, unless it is
reasonably certain that the group will obtain ownership by the end of the lease term. Land is not depreciated.

The current estimated useful lives for the current and comparative periods are:

• mine properties – life-of-mine, currently between seven (2013: eight and 2012: three) and eight (2013: nine and 2012:

eleven) years;

• mine development – life-of-mine, currently between seven (2013: eight and 2012: three) and eight (2013: nine and

2012: eleven) years;

• mine plant facilities – life-of-mine, currently between six (2013: 18 and 2012: 36) months and eight (2013: nine and

2012: eleven) years; and

• equipment and vehicles – three to five years.

The residual values, estimated useful lives and depreciation method are reassessed annually and adjusted if appropriate.

Leased assets

Leases in terms of which the group assumes substantially all the risks and rewards of ownership are classified as finance leases.
Upon initial recognition, the leased asset and liability are measured at amounts 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.

IMPAIRMENT

Financial assets

A financial asset 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.

Financial assets measured at amortized cost

An impairment loss in respect of a financial asset measured at amortized cost is calculated as the difference between its carrying
amount and the present value of the estimated future cash flows discounted at the original effective interest rate, that is, the
effective interest rate computed at initial recognition of these financial assets.

F-19

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

1. ACCOUNTING POLICIES (continued)

IMPAIRMENT (continued)

Available-for-sale financial assets

An impairment loss in respect of an available-for-sale financial asset is calculated by reference to its fair value. When a decline in
the fair value of an available-for-sale financial asset has been recognized directly in other comprehensive income, and there is
objective evidence (e.g. significant or prolonged decline in the fair value below the cost of the investment) that the asset is
impaired, the cumulative loss that had been recognized in other comprehensive income is recognized in profit or loss even though
the financial asset has not been derecognized. The amount of the cumulative loss that is recognized in profit or loss is the
difference between the acquisition cost and current fair value, less any impairment loss on that financial asset previously
recognized in profit or loss. Financial assets that are individually significant are tested for impairment on an individual basis. The
remaining financial assets are assessed collectively in groups that share similar credit risk characteristics. All impairment losses
are recognized in profit or loss.

An impairment loss is reversed if the reversal can be related objectively to an event occurring after the impairment loss was
recognized. For financial assets measured at amortized cost and available-for-sale financial assets that are debt securities, the
reversal is recognized in profit or loss. For available-for-sale financial assets that are equity securities, the reversal is recognized
in other comprehensive income.

Non-financial assets

The carrying amounts of the group’s assets, other than inventories and deferred tax assets are reviewed at each reporting date to
determine whether there is any indication of impairment. If any such indication exists, the recoverable amount is estimated.

The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. In
assessing 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. For purposes of impairment
testing, assets are grouped together into the smallest group of assets which generates cash flows from continuing use that is
largely independent of the cash inflows of other assets or groups of assets (cash-generating units).

An impairment loss is recognised directly against the carrying amount of the asset whenever the carrying amount of an asset, or
its cash generating unit, exceeds its recoverable amount. Impairment losses are recognised in profit or loss.

Impairment losses recognised in respect of cash-generating units are allocated to the carrying amounts of the assets in the unit
(group of units) on a pro rata basis. Impairment losses recognised in prior periods are assessed at each reporting date for any
indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the
estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying
amount does not exceed the carrying amount that would have been determined, net of depreciation, if no impairment loss had
been recognised.

Exploration assets

Exploration assets are assessed for impairment if facts and circumstances suggest that the carrying amount exceeds the
recoverable amount. For purposes of impairment testing, exploration assets are allocated to cash-generating units consistent with
the determination of reportable segments.

The technical feasibility and commercial viability of extracting a Mineral Resource is considered to be determinable when proven
reserves are determined to exist. Upon the determination of proven reserves, exploration assets attributable to those Reserves are
first tested for impairment and then reclassified from exploration assets to a separate category within tangible assets. Expenditure
deemed to be unsuccessful is recognized in profit or loss immediately.

INVENTORIES

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. Selling, refining and general administration costs are excluded from
inventory valuation.

Consumable stores are stated at the lower of cost and net realisable value. Cost of consumables is based on the weighted average
cost principle and includes expenditure incurred in acquiring inventories and bringing them to their existing location and
condition.

F-20

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

1. ACCOUNTING POLICIES (continued)

INVENTORIES (continued)

Bullion is stated at the lower of cost and net realisable value.

Net realisable value is the estimated selling price in the ordinary course of business, less the estimated cost of completion and
selling expenses.

INCOME TAX

Income tax expense comprises current and deferred tax. Income tax is recognised in profit or loss except to the extent that it
relates to business combinations, or to items recognised directly in equity or other comprehensive income.

Current tax

Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted, or substantively enacted, at the
reporting date, and any adjustment to tax payable in respect of previous years.

Deferred tax

Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts recognised for tax purposes. Deferred tax is not recognised for the following temporary
differences: the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither
accounting nor taxable profit; and differences relating to investments in subsidiaries and joint ventures to the extent that it is
probable that they will not reverse in the foreseeable future. In addition, deferred tax is not recognised for taxable temporary
differences arising on the initial recognition of goodwill.

Deferred tax is measured at the tax rates that are expected to be applied to the temporary differences, based on the expected
manner of realisation or settlement of the carrying amount of assets and liabilities, and based on the laws that have been enacted
or substantively enacted by the reporting date.

Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets, if these
relate to income taxes levied by the same tax authority on the same taxable entity or on different tax entities, if the company
intends to settle current tax liabilities and assets on a net basis, or if their tax assets and liabilities will be realised simultaneously.

A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which
the temporary difference can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that
it is no longer probable that the related tax benefit will be realised.

Dividends Withholding tax

Dividends withholding tax is a tax on certain shareholders receiving dividends and is applicable to all dividends declared on or
after April 1, 2012.

The company withholds dividends tax on behalf of certain of its shareholders at a rate of 15% on dividends declared. Amounts
withheld are not recognised as part of the company’s tax charge but rather as part of the dividend paid recognised directly in
equity. Where withholding tax is withheld on dividends received, the dividend is recognised at the gross amount with the related
withholdings tax recognised as part of tax expense unless it is otherwise reimbursable in which case it is recognised as an asset.

SHARE CAPITAL

Ordinary share capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares are recognized as a
deduction from equity, net of any tax effect.

Preference share capital

Preference share capital is classified as equity if it is non-redeemable, or redeemable only at the company's option, and any
dividends are discretionary. Dividends on preference share capital classified as equity are recognized as distributions within
equity. Preference share capital is classified as a liability if it is redeemable on a specified date or at the option of the
shareholders, or if dividend payments are not discretionary. Dividends thereon are recognized as interest expense in profit or loss
as accrued.

F-21

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

1. ACCOUNTING POLICIES (continued)

SHARE CAPITAL (continued)

Dividends

Dividends are recognized as a liability in the period in which they are declared.

EMPLOYEE BENEFITS

Defined contribution plans

A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions into a separate
entity and has no legal or constructive obligation to pay further amounts. Pension plans, which are multi-employer plans in the
nature of defined contribution plans, are funded through monthly contributions to these defined contribution plans. Obligations
for contributions are recognised as an employee benefit expense in profit or loss as incurred.

Long-service benefits

The group makes long-service bonus payments (long-service awards) for certain eligible employees under the Chamber of Mines
of South Africa Long Service Award Scheme. The amount of the award is based on both the employee’s skill level and years of
service with gold mining companies that qualify for the scheme. The obligation is accrued over the service life of the employees
and is calculated using a projected unit credit method. Any actuarial gains or losses are recognised in other comprehensive
income in the period in which they arise.

Post-retirement medical benefits

Post-retirement medical benefits in respect of qualifying employees are recognised over the expected remaining service lives of
relevant employees and the remaining life expectancies of retirees. The group has an obligation to provide medical benefits to
certain of its pensioners and dependants of ex-employees. These liabilities are provided in full, calculated on an actuarial basis
and discounted using the projected unit credit method. The discount rate is the yield at the reporting date on corporate bonds that
have maturity dates approximating the terms of the group’s obligations and that are denominated in the same currency in which
the benefits are expected to be paid. Periodic valuation (currently every three years) of these obligations is carried out by
independent actuaries using appropriate mortality tables, long-term estimates of increases in medical costs and appropriate
discount rates. The fair value of any plan assets is deducted. Actuarial gains and losses are recognised immediately in other
comprehensive income. When the calculation results in a benefit to the group, the recognised asset is limited to the net total of
any unrecognised past service costs and the present value of any future refunds from the plan or reductions in future contributions
to the plan.

When the benefits of a plan are changed, the portion of the changed benefit relating to past service by employees is recognised in
profit or loss on a straight-line basis over the average period until the benefits become vested. To the extent that the benefits vest
immediately, the expense is recognised immediately in other comprehensive income.

Termination benefits

Termination benefits are recognised as an expense when the group is demonstrably committed, without realistic possibility of
withdrawal, to a formal detailed plan to either terminate employment before the normal retirement date, or to provide termination
benefits as a result of an offer made to encourage voluntary redundancy.

Termination benefits for voluntary redundancies are recognised as an expense if the group has made an offer for voluntary
redundancy, it is probable that the offer will be accepted, and the number of acceptances can be estimated reliably. If benefits are
payable more than 12 months after the reporting period, they are discounted to their present value.

Share-based payment transactions

Equity settled share based payment awards
The group grants share options to certain employees under an employee share plan to acquire shares of the company. The fair
value of options granted is recognised as an employee expense with a corresponding increase in equity. The fair value is
measured at grant date and spread over the period during which the employees become unconditionally entitled to the options.

The fair value of the options granted is measured using the Black-Scholes option pricing model, taking into account the terms and
conditions upon which the options were granted. The amount recognised as an expense is adjusted to reflect the actual number of
share options that vest, except where forfeiture is only due to market conditions such as share prices not achieving the threshold
for vesting.

F-22

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

1. ACCOUNTING POLICIES (continued)

EMPLOYEE BENEFITS (continued)

Cash settled share based payment awards
The fair value of the amount payable to employees in respect of share appreciation rights, which are settled in cash, is recognised
as an expense with a corresponding increase in liabilities, over the period that the employees become unconditionally entitled to
payment. The liability is remeasured at each reporting date and at settlement date based on the fair value of the share appreciation
rights. Any changes in the liability are recognised as employee benefit expenses in profit or loss. The fair value of the options
granted is measured using the Black-Scholes option pricing model at each reporting date.

PROVISIONS

A provision is recognized in the statement of financial position when the group has present legal or constructive obligations
resulting from past events that can be estimated reliably and it is probable that an outflow of economic benefits will be required to
settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current
market assessments of the time value of money and, where appropriate, the risks specific to the liability.

Decommissioning liabilities

The provision for decommissioning represents the cost that will arise from rectifying damage caused before production
commenced. Accordingly, an asset is recognized and included within mining properties. Decommissioning liabilities are
measured at the present value of the expenditures expected to settle the obligation, using estimated cash flows based on current
prices. The unwinding of the decommissioning obligation is included in profit or loss. Estimated future costs of decommissioning
obligations are reviewed regularly and adjusted as appropriate for new circumstances or changes in law or technology. Changes in
estimates are capitalized or reversed against the relevant asset. Gains or losses from the expected disposal of assets are not taken
into account when determining the provision.

Restoration liabilities

The provision for restoration represents the cost of restoring site damage after the start of production. Increases in the provision
are recognized in profit or loss as a cost of production. Gross restoration liabilities are estimated at the present value of the
expenditures expected to settle the obligation.

Rehabilitation obligation funds

Rehabilitation obligation funds are used to cover the estimated cost of rehabilitation at the end of the life of the relevant mine.
These contributions are recognised as a right to receive a reimbursement from the fund and measured at the lower of the amount
of the decommissioning obligation recognised and the fair value of the fund assets. Changes in the carrying value of the fund
assets, other than contributions to and payments from the fund, are recognised in profit or loss.

REVENUE RECOGNITION

Gold bullion and by-products

The group recognizes revenue from the sale of gold bullion and by-products at the fair value of the consideration received or
receivable. Revenue is recognized in profit or loss when the significant risks and rewards of ownership have been transferred to
the buyer, recovery of the consideration is probable, the associated costs can be estimated reliably, there is no continuing
management involvement with the goods, and the amount of revenue can be measured reliably. These criteria are usually met
when Rand Refinery sells the refined gold (refer note 26).

Government grants

Government grants are not recognized until there is reasonable assurance that the entity will comply with the conditions attaching
to them and the grant will be received. Grants that compensate the group for expenses incurred are recognized in profit or loss as
a deduction against the related expense.

Finance income

Finance income includes dividends received, interest received, growth in the environmental rehabilitation obligation funds, net
gains on financial instruments measured at amortised cost, net foreign exchange gains, and other profits and losses arising on
disposal of investments. Dividends are recognised when the group’s right to receive payment is established. Interest is recognised
on a time proportion basis, taking account of the principle outstanding and the effective rate to maturity on the accrual basis.

F-23

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

1. ACCOUNTING POLICIES (continued)

EXPENSES

Operating lease payments

Payments made under operating leases are recognized in profit or loss on a straight-line basis over the period of the lease.

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.

Finance expenses

Finance expenses comprise interest payable on borrowings calculated using the effective interest method, unwinding of the
discount of the provision for environmental rehabilitation, net foreign exchange losses, net losses on financial instruments
measured at amortized cost, and interest on finance leases.

Borrowing costs capitalized

Interest on borrowings relating to the financing of qualifying major capital projects under construction is capitalized during the
construction phase as part of the cost of the project. Such borrowing costs are capitalized over the period during which the asset is
being acquired or constructed and borrowings have been incurred. Capitalization ceases when construction is interrupted for an
extended period or when the asset is substantially complete. Other borrowing costs are expensed as incurred.

SEGMENT REPORTING

Operating segments are identified on the basis of internal reports that the group’s chief operating decision maker (CODM)
reviews regularly in allocating resources to segments and in assessing their performance. The CODM for the group has been
identified as the group’s executive committee. Reportable segments are identified based on quantitative thresholds of revenue,
profit or loss, and assets. The amounts disclosed for each reportable segment are the measures reported to the CODM, which are
not necessarily based on the same accounting policies as the amounts recognized in the financial statements. Aggregation of
operating segments is implemented where disclosure of information enables users of the group’s financial statements to evaluate
the nature and effects of the business activities in which it engages and the economic environment in which it operates, where the
operating segments have characteristics so similar that they can be expected to have essentially the same future prospects and
where they are similar in the following respects:

· the nature of products and services;
· the nature of the production process;
· the type or class of customer for their products and services;
· the methods used to distribute their products or provide their services; and
· if applicable, the nature of the regulatory environment.

ASSETS HELD-FOR-SALE AND DISCONTINUED OPERATIONS

Non-current assets, or disposal groups comprising asset and liabilities, are classified as held-for-sale if it is highly probable that
they will be recovered primarily through sale rather than continuing use.

Such assets, or disposal groups are generally measured at lower of their carrying amount and fair value less cost to sell. Any
impairment loss on disposal group is allocated first to goodwill, and then to the remaining assets and liabilities on a pro rata basis,
except that no loss is allocated to inventories, financial assets, deferred tax assets, employee benefit assets and investment
property, which continue to be measured in accordance with the group’s other accounting policies. Impairment losses on initial
application as held-for-sale and subsequent gains and losses on remeasurement are recognised in profit or loss.

Once classified as held-for-sale, intangible assets and property, plant and equipment, are no longer amortised or depreciated, and
any equity accounted investee is no longer equity accounted.

A discontinued operation in the group is a component of the group's business that represents a separate major line of business, a
geographical area of operations which has been disposed of or is held-for-sale, or a subsidiary acquired exclusively for resale.
When an operation is classified as a discontinued operation, the comparative statement of profit or loss and other comprehensive
income is restated as if the operation had been discontinued from the start of the comparative period.

F-24

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

1. ACCOUNTING POLICIES (continued)

EARNINGS OR LOSS PER SHARE

The group presents basic and diluted earnings per share data for its ordinary shares. Basic earnings or loss per share is calculated
based on the net profit or loss after taxation for the year attributable to ordinary shareholders of the company, divided by the
weighted average number of ordinary shares in issue during the year. Diluted earnings or loss per share is presented when the
inclusion of ordinary shares that may be issued in the future, which comprise share options granted to employees, has a dilutive
effect on earnings or loss per share.

NEW ACCOUNTING STANDARDS AND INTERPRETATIONS NOT YET ADOPTED

At the date of authorisation of these financial statements, the following relevant standards and amendments to accounting
standards that may be applicable to the business of the entity were in issue but not yet effective and may therefore have an impact
on future financial statements. These new standards and amendments to accounting standards have not been early adopted by the
group and a reliable estimateof the impact of the adoption thereof for the group is yet to be determined. The group expects to
adopt the standards and amendments to accounting standards when effective.

Standard/interpretation

Effective date

IAS 32

Offsetting Financial Assets and Financial Liabilities

January 1, 2014

IAS 36

Recoverable amount disclosures for Non-financial Assets

January 1, 2014

IAS 19

Defined Benefit Plans: Employee Contributions

July 1, 2014

IAS 24

Related party disclosures

July 1, 2014

IFRS

Share-based payments

July 1, 2014

IFRS 3

Business combinations

July 1, 2014

IFRS

Operating segments

July 1, 2014

IFRS 13

Fair value measurements

July 1, 2014

IFRS 15

Revenue from contracts with customers

January 1, 2017

IFRS

Financial Instruments

January 1, 2018

Each of these standards and interpretations is described briefly below:

IAS 32 – offsetting financial assets and financial liabilities
The amended IAS 32 requires disclosure of the actual and potential effects of netting arrangements on the entity’s financial
positioning, clarifies current offsetting criteria and addresses inconsistencies in their application.

IAS 36 amendment – recoverable amount disclosures for non-financial assets
The amendments reverse the unintended requirement in IFRS 13 fair value measurement to disclose the recoverable amount of
every cash-generating unit to which significant goodwill or indefinite-lived intangible assets have been allocated. Under the
amendments, the recoverable amount is required to be disclosed only when an impairment loss has been recognised or reversed.

IAS 19 – Defined Benefit Plans: employee contributions
The amendments introduce relief that will reduce the complexity and burden of accounting for certain contributions from
employees or third parties. Such contributions are eligible for the practical expedient if they are:
• set out in the formal terms of the plan;
• linked to service; and
• independent of the number of years of service.

When contributions are eligible for the practical expedient, a company is permitted (but not required) to recognise them as a
reduction of the service cost in the period in which the related service is rendered. The group’s defined benefit plan meets these
requirements and consequently the group intends to apply this amendment and will recognise the contributions as a reduction of
the service costs in the period in which the related service is rendered. The amendments apply retrospectively for annual periods
beginning on or after July 1, 2014 with early adoption permitted.

F-25

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

1. ACCOUNTING POLICIES (continued)

NEW ACCOUNTING STANDARDS AND INTERPRETATIONS NOT YET ADOPTED (continued)

IAS 24 Related Party Disclosures – Definition of ‘related party’
The definition of a ‘related party’ is extended to include a management entity that provides key management personnel (KMP)
services to the reporting entity, either directly or through a group entity.

For related party transactions that arise when KMP services are provided to a reporting entity, the reporting entity is required to
separately disclose the amounts that it has recognised as an expense for those services that are provided by a management entity;
however, it is not required to ‘look through’ the management entity and disclose compensation paid by the management entity to
the individuals providing the KMP services. The reporting entity will also need to disclose other transactions with the
management entity under the existing disclosure requirements of IAS 24 – e.g. loans.

IFRS 2 Share-based payments – Meaning of ‘vesting condition’
IFRS 2 has been amended to clarify the definition of ‘vesting condition’ by separately defining ‘performance condition’ and ‘
service condition’.

For a condition to be a performance condition, it needs to meet both of the following criteria:
• The counterparty has to complete a specified period of service – i.e. a service condition, which can be either explicit or implicit;

and

• The specified performance target(s) has to be met while the counterparty is rendering services.

The period for achieving the performance target(s) cannot extend beyond of the service period, but it may start before the
service period – provided that the commencement of the performance target is not substantially before the commencement of
the service period. As such, performance targets achieved after the requisite service period would not be accounted for as a
performance condition, but would instead be accounted for as a non-vesting condition.

A performance target need to be defined with reference to the entity’s own operations or activities, or with reference to the price
or value of the entity’s equity instruments. In this context, ‘entity’ includes entities within the same group.

The amendment also clarifies both:
• How to distinguish between a market and a non-market performance condition; and
• The basis on which a performance condition can be differentiated from a non-vesting condition.

For example, a share market index target would be a non-vesting condition – even if an entity’s shares form part of that index –
because such and index reflects not only the performance of the entity, but also the performance of the other entities outside the
group.

Any failure to complete a specified service period – even due to the entity terminating an employee’s employment – would
represent failure to satisfy a service condition.

IFRS 3 : Business Combinations – Classification and measurement of contingent consideration
These amendments clarify the classification and measurement of contingent consideration in a business combination.
• When contingent consideration is a financial instrument, its classification as a liability or equity is determined by reference to

IAS 32 Financial Instruments: Presentation, rather than to any other IFRSs.

• Contingent consideration that is classified as an asset or a liability is always subsequently measured at fair value, with changes

in fair value recognised in profit or loss.

Consequential amendments are also made to IAS 39 Financial Instruments: Recognition and Measurement and IFRS 9 Financial
Instruments to prohibit contingent consideration from subsequently being measured at amortised cost. In addition, IAS 37
Provisions, Contingent Liabilities and Contingent Assets is amended to exclude provisions related to contingent consideration.

Scope exclusion for the formation of joint arrangements

IFRS 3 has also been amended to clarify that the standard does not apply to the accounting for the formation of all types of joint
arrangements in IFRS 11 Joint Arrangements – i.e. including joint operations – in the financial statements of the joint
arrangements themselves.

F-26

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

1. ACCOUNTING POLICIES (continued)

NEW ACCOUNTING STANDARDS AND INTERPRETATIONS NOT YET ADOPTED (continued)

IFRS 8 Operating segments – Disclosures on the aggregation of operating segments
IFRS 8 has been amended to explicitly require the disclosure of judgements made by management in applying the aggregation
criteria. The disclosures include:
• A brief description of the operating segments that have been aggregated; and
• The economic indicators that have been assessed in determining that the operating segments share similar economic

characteristics.

In addition, this amendment clarifies that the reconciliation of the total of the reportable segments’ assets to the entity’s assets is
required only if this information is regularly provided to the entity’s chief operating decision maker. This change aligns the
disclosure requirements with those for segment liabilities.

IFRS 13 Fair Value Measurement – Measurement of short-term receivables and payables
The IASB has clarified that, in issuing IFRS 13 and making consequential amendments to IAS 39 and IFRS 9, it did not intend to
prevent entities from measuring short-term receivables and payables that have no stated interest rate at their invoiced amounts
without discounting, if the effect of not discounting is immaterial.

Scope of portfolio exception
The scope of the IFRS 13 portfolio exception – whereby entities are exempted from measuring the fair value of a group of
financial assets and financial liabilities with offsetting risk positions on a net basis if certain conditions are met – has been aligned
with the scope of IAS 39 and IFRS 9.

IFRS 13 has been amended to clarify that the portfolio exception potentially applies to contracts in the scope of IAS 39 and IFRS
9 regardless of whether they meet the definition of a financial asset or a financial liability under IAS 32 – e.g. certain contracts to
buy or sell non-financial items that can be settled net in cash or another financial instrument

IFRS 15 Revenue from contracts with customers
The standard contains a single model that applies to contracts with customers and two approaches to recognising revenue: at a
point in time or over time. The model features a contract-based five-step analysis of transactions to determine whether, how much
and when revenue is recognised.

IFRS 9 – financial instruments (2010), IFRS 9 Financial Instruments (2009)
IFRS 9 (2009) introduces new requirements for the classification and measurements of financial assets. Under IFRS 9 (2009)
financial assets are classified and measured based on the business model in which they are held and the characteristics of their
contractual cash flows. IFRS 9 (2010) introduces additional changes relating to the financial liabilities. The IASB currently has an
active project to make limited amendments to the classification and measurement requirements of IFRS 9 and add new
requirements to address the impairment of financial assets and hedge accounting.

IFRS 9 (2010) and (2009) are effective for annual periods beginning on or after January 1, 2018, with early adoption permitted.
The adoption of these standards is expected to have an impact on the group’s financial assets, but no impact on the group’s
financial liabilities.

2. OPERATING SEGMENTS

The following summary describes the operations in each of the group’s reportable operating segments:

· Ergo is a surface retreatment operation and treats old slime and sand dumps to the south of Johannesburg’s central
  business district as well as the east and central Rand goldfields. The operation comprises four plants. Brakpan and
  Knights continues to operate as metallurgical plants but Crown and City Deep have been converted to pump/milling
  stations.
· Corporate office and other reconciling items   are taken into consideration in the strategic decision-making process of
  the CODM and are therefore included in the disclosure here, even though they do not earn revenue. They do not
  represent a separate segment.
· Blyvoor: incorporates the Doornfontein mine, situated on the north-western edge of the Witwatersrand basin. The mine
  has underground and surface operations. Blyvoor was disposed of during the year ended June 30, 2012 and the segment
  therefore reflect the results of Blyvoor until the effective date of June 1, 2012 (refer to note 11).

The reportable segments, as described below, are the group’s strategic divisions. The strategic divisions reflect different
operational locations reported on separately to the executive committee (chief operating decision maker or CODM). The group’s
revenue stream consists of the sale of gold bullion.

F-27

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

2. OPERATING SEGMENTS (continued)

2014

Ergo

R’000

Corporate office

and other

reconciling items

R’000

Total

R’000

Financial performance
Segmental revenue

1,809,434

Cash operating costs

(1,540,622)

Movement in gold in process

(8,828)

Operating profit

259,984

Finance income

1,011

17,279

18,290

Finance expense

(270)

(17,540)

(17,810)

Retrenchment costs

(1,074)

(5,674)

(6,748)

Administration expenses and general costs

(3,236)

(74,884)

(78,120)

Income tax (1)

(439)

(5,982)

(6,421)

Working profit/(loss) before additions to non-current assets

255,976

(86,801)

169,175

Additions to property, plant and equipment

(158,548)

(45)

(158,593)

Additions to listed investments

(5,246)

Additions to unlisted investments

(7)

Working profit/(loss) after additions to non-current assets

97,428

(92,099)

5,329

(1) The income tax excludes deferred tax.

F-28

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

2. OPERATING SEGMENTS (continued)

2014

Ergo

Corporate office

and other

reconciling items

Total

Operating results (1)
Ore milled

- surface

t000

23,908 -

23,908

Average yield

- surface

g/t

0.17 -

0.17

Gold produced

- surface

4,134 -

4,134

- surface

132,909 -

132,909

Cash operating costs

- surface

R/kg

372,671 -

372,671

- surface

$/oz

1,118 -

1,118

All-in sustaining cost

R/kg

401,691

$/oz

1,205

All-in cost

R/kg

436,503

$/oz

1,309

Gold price received

- revenue

R/kg

432,775 -

432,775

- revenue

$/oz

1,298 -

1,298

R’000

Reconciliation of assets
Property,plant and equipment

1,729,521

25,982

1,755,503

Other assets

345,329

339,914

685,243

Total assets

2,074,850

365,896

2,440,746

Reconciliation of liabilities

Reportable segment liabilities

637,098

206,354

843,452

Tax and deferred tax

116,084

Total liabilities

753,182

206,354

959,536

(1) Unaudited

F-29

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

2. OPERATING SEGMENTS (continued)

2014

Ergo

R’000

Corporate office

and other

reconciling items

R’000

Total

R’000

Other material information

Depreciation

(159,836)

(163)

(159,999)

Impairment of assets

(14,788)

(41,803)

(56,591)

Reconciliation of revenues
Total revenues for reportable segments

1,809,434

Statement of cash flows
Cash flows from operating activities

211,270

(130,579)

80,691

Cash flows from investing activities

(171,727)

(51)

(171,778)

Cash flows from financing activities

(76,632)

Reconciliation of profit/(loss)
Segment working profit/(loss) before additions to non-current assets

255,976

(86,801)

169,175

- Depreciation

(159,836)

(163)

(159,999)

- Movement in provision for environmental rehabilitation

82,281

4,324

86,605

- Impairments

(14,788)

(41,803)

(56,591)

- Growth in environmental rehabilitation trust funds and reimbursive rights

6,423

3,266

9,689

- Profit on disposal of property, plant and equipment

902

992

- Unwinding of provision for environmental rehabilitation

(36,300)

(1,719)

(38,019)

- Borrowing costs capitalized

3,534

- Ongoing rehabilitation expenditure

(29,973)

(14)

(29,987)

- Share of losses of equity accounted investments

(313)

- Net other operating costs

(15,005)

(13,677)

(28,682)

- Deferred tax

(9,662)

(1,465)

(11,127)

Profit/(loss) for the year

82,740

(137,463)

(54,723)

2014

Revenues

Property, plant

and equipment

R’000

Geographical information
South Africa

1,809,434

1,755,503

Zimbabwe

Total

1,809,434

1,755,503

Information about major customers

Due to regulatory authority, the group has only one major gold ore customer in each geographical area.

F-30

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

2. OPERATING SEGMENTS (continued)

2013 Restated

Ergo

R’000

Corporate office

and other

reconciling items

R’000

Total

R’000

Financial performance
Segmental revenue

2,076,496

Cash operating costs

(1,414,904)

Movement in gold in process

17,727

Operating profit

679,319

Finance income

3,187

53,310

56,497

Finance expense

(175)

(19,209)

(19,384)

Retrenchment costs

(565)

Administration expenses and general costs

(10,558)

(53,991)

(64,549)

Income tax (1)

(87)

(4,125)

(4,212)

Working profit/(loss) before additions to non-current assets

671,686

(24,580)

647,106

Additions to property, plant and equipment

(368,306)

(89)

(368,395)

Contributions to environmental obligation funds

(14,592)

(12,818)

(27,410)

Advance to equity accounted investments

(13,946)

Additions to unlisted investments

(26,864)

Working profit/(loss) after additions to non-current assets

288,788

(78,297)

210,491

(1) The income tax excludes deferred tax.

F-31

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

2. OPERATING SEGMENTS (continued)

2013 Restated

Ergo

Corporate office

and other

reconciling items

Total

Operating results (1)
Ore milled

- surface

t000

23,254

- 23,254

Average yield

- surface

g/t

0.20

- 0.20

Gold produced

- surface

4,553

- 4,553

- surface

146,381

- 146,381

Cash operating costs

- surface

R/kg

310,763

- 310,763

- surface

$/oz

1,094

- 1,094

All-in sustaining cost

R/kg

362,599

$/oz

1,192

All-in cost

R/kg

433,669

$/oz

1,442

Gold price received

- revenue

R/kg

458,084

- 458,084

- revenue

$/oz

1,613

- 1,613

R’000

Reconciliation of assets
Property, plant and equipment

1,729,482

26,851

1,756,333

Equity accounted investment

313

Other assets

380,716

531,638

912,354

Total assets

2,110,198

558,802

2,669,000

Reconciliation of liabilities

Reportable segment liabilities

682,034

236,872

918,906

Tax and deferred tax

106,422

Total liabilities

788,456

236,872

1,025,328

(1) Unaudited

F-32

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

2. OPERATING SEGMENTS (continued)

2013 Restated

Ergo

R’000

Corporate office

and other

reconciling items

R’000

Total

R’000

Other material information

Depreciation

(143,606)

(160)

(143,766)

Impairment of assets

(61,043)

(126,823)

(187,866)

Reconciliation of revenues

Total revenues for reportable segments

2,076,496

Statement of cash flows

Cash flows from operating activities

543,234

(41,018)

502,216

Cash flows from investing activities

(388,424)

(40,959)

(429,383)

Cash flows from financing activities

5,697

Reconciliation of profit/(loss)
Segment working profit/(loss) before additions to non-current assets

671,686

(24,580)

647,106

- Depreciation

(143,606)

(160)

(143,766)

- Movement in provision for environmental rehabilitation

(35,694)

20,360

(15,334)

- Impairments

(61,043)

(126,823)

(187,866)

- Growth in environmental rehabilitation trust funds and reimbursive right

4,960

4,535

9,495

- Profit on disposal of property, plant and equipment

19,198

19,267

- Unwinding of provision for environmental rehabilitation

(31,982)

(1,555)

(33,537)

- Borrowing costs capitalized

10,946

- Ongoing rehabilitation expenditure

(45,444)

- Share of losses of equity accounted investments

(50,135)

- Net other operating costs

(31,857)

(24,501)

(56,358)

- Deferred tax

(53,979)

(2,737)

(56,716)

Profit/(loss) for the year

284,056

(186,398)

97,658

2013 Restated

Revenues

Equity

accounted

investments

Property, plant

and equipment

R’000

Geographical information

South Africa

2,076,496

1,756,333

Zimbabwe

313

Total

2,076,496

313

1,756,333

Information about major customers

Due to regulatory authority, the group has only one major gold ore customer in each geographical area.

F-33

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

2. OPERATING SEGMENTS (continued)

2012 Restated

Blyvoor

R’000

Ergo

R’000

Corporate office

and other

reconciling items

R’000

Total

R’000

Financial performance
Segmental revenue

1,240,073

1,764,191

3,004,264

Cash operating costs

(1,052,197)

(1,151,400)

(2,203,597)

Movement in gold in process

5,283

9,427

14,710

Operating profit

193,159

622,218

815,377

Finance income

732

777

14,638

16,147

Finance expense

(817)

(18)

(7,497)

(8,332)

Retrenchment costs

(43,747)

Administration expenses and general costs

(10,918)

(23,859)

(98,813)

(133,590)

Income tax (1)

(172)

(4,521)

(4,693)

Working profit/(loss) before additions to non-current assets

138,409

598,946

(96,193)

641,162

Additions to property, plant and equipment

(82,938)

(236,159)

(319,097)

Contributions to environmental obligation funds

(29,575)

(16,313)

(45,888)

Advance to equity accounted investments

(14,549)

Additions to unlisted investments

(9,609)

Working profit/(loss) after additions to non-current assets

55,471

333,212

(136,664)

252,019

(1) The tax charge excludes deferred tax.

F-34

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

2. OPERATING SEGMENTS (continued)

2012 Restated

Blyvoor

Ergo

Corporate office

and other

reconciling items

Total

Operating results (1)
Ore milled

- underground

t000

569

- 569

- surface

t000

2,725

21,603

- 24,328

- total

t000

3,294

21,603

- 24,897

Average yield

- underground

g/t

3.99

- 3.99

- surface

g/t

0.27

0.20

- 0.20

- total

g/t

0.91

0.20

- 0.29

Gold dispatched

- underground

2,272

- 2,272

- surface

734

4,221

- 4,955

- total

3,006

4,221

- 7,227

- underground

73,048

- 73,048

- surface

23,597

135,708

- 159,305

- total

96,645

135,708

- 232,353

Cash operating costs

- underground

R/kg

416,540

- 416,540

- surface

R/kg

144,166

272,778

- 253,727

- total

R/kg

350,032

272,778

- 304,912

- underground

$/oz

1,671

- 1,671

- surface

$/oz

578

1,096

- 1,018

- total

$/oz

1,404

1,096

- 1,223

All-in sustaining cost

R/kg

355,571

$/oz

1,338

All-in cost

R/kg

391,732

$/oz

1,572

Gold price received

- revenue

R/kg

412,533

417,956

- 415,700

- revenue

$/oz

1,677

1,682

- 1,679

(1) Unaudited

F-35

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

2. OPERATING SEGMENTS (continued)

2012 Restated

Blyvoor

R’000

Ergo

R’000

Corporate office

and other

reconciling items

R’000

Total

R’000

Reconciliation of assets
Reportable segment assets

1,569,148

45,425

1,614,573

Equity accounted investments

27,368

Other assets

313,147

533,918

847,065

Total assets

1,882,295

606,711

2,489,006

Reconciliation of liabilities

Reportable segment liabilities

592,966

174,700

767,666

Tax and deferred tax

87,748

1,826

89,574

Total liabilities

680,714

176,526

857,240

Other material information

Depreciation

(1,661)

(117,457)

(1,732)

(120,850)

Impairment of assets

(1,100)

Reconciliation of revenues

Total revenues for reportable segments

1,240,073

1,764,191

3,004,264

Statement of cash flows

Cash flows from operating activities

137,068

558,706

(74,604)

621,170

Cash flows from investing activities

(82,938)

(285,500)

(37,585)

(406,023)

Cash flows from financing activities

(168,553)

Reconciliation of profit/(loss)

Segment working profit/(loss) before additions to non-current assets

138,409

598,946

(96,193)

641,162

- Depreciation

(1,661)

(117,457)

(1,732)

(120,850)

- Movement in provision for environmental rehabilitation

301

(48,292)

(11,194)

(59,185)

- Impairments

(1,100)

- Net gain on financial liabilities measured at amortized cost

6,656

- Growth in environmental rehabilitation trust funds

1,606

3,276

5,861

10,743

- Net loss on financial liabilities measured at amortized cost

(6,372)

- Unwinding of provision for environmental rehabilitation

(1,211)

(5,153)

(928)

(7,292)

- Borrowing costs capitalized

4,290

- Loss on disposal of property, plant and equipment

(9,556)

- Actuarial loss on post-retirement and other employee benefits

(67)

- Loss on disposal of subsidiary

(10,532)

- Ongoing rehabilitation expenditure

(990)

(39,445)

(7,850)

(48,285)

- Net other operating (cost) / income

(8,583)

(23,931)

1,229

(31,285)

- Deferred tax

6,541

(66)

6,475

Profit/(loss) for the year

123,995

378,708

(127,901)

374,802

F-36

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

2. OPERATING SEGMENTS (continued)

2012 Restated

Revenues

Equity accounted

investments

Property,
plant and

equipment

R’000

Geographical Information

South Africa

3,004,264

1,614,573

Zimbabwe

27,368

Total

3,004,264

27,368

1,614,573

Information about major customers

Due to regulatory authority, the group has only one major gold ore customer in each geographical area.

F-37

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

2014

2013

Restated

2012

Restated

R’000

3. REVENUE

Revenue consists of the following principal categories:

Gold revenue

1,807,145

2,073,340

2,982,290

By-product revenue

2,289

3,156

21,974

Total revenue

1,809,434

2,076,496

3,004,264

4. RESULTS FROM OPERATING ACTIVITIES
include the following:

Auditors' remuneration

(5,787)

(7,160)

(10,019)

Audit fees – current year

(5,787)

(6,702)

(10,019)

Fees for other services

(458)

Management, technical, administrative and secretarial
service fees

(6,996)

(9,072)

(14,187)

Staff costs
Included in staff costs are:

(306,501)

(287,908)

(826,017)

Salaries and wages

(276,205)

(265,950)

(724,049)

Share-based payments

(3,341)

(4,515)

(4,133)

Retrenchment costs

(6,748)

(565)

(43,747)

Post-retirement and other employee benefits

(20,207)

(16,878)

(54,088)

Learnership grants

8,813

1,893

2,622

Grants received from the Mining Qualifications Authority
offset against cost incurred.

Profit/(loss) on disposal of property, plant and equipment

992

19,267

(9,556)

(Impairments)/reversal of impairments

(56,591)

(187,866)

(1,100)

Property, plant and equipment

(12,377)

(61,043)

Impairment of available-for-sale financial asset

(46,914)

Investment in and loans to equity accounted investment

2,700

Impairment of available-for-sale financial assets reclassified from other
comprehensive income

(101,261)

Rehabilitation trust fund

(25,562)

(1,100)

During FY2014, the group recorded an impairment of R12.4 million (2013: R61 million) against property, plant and equipment
based on the recoverable amount (value in use) of these assets being lower than their carrying amount. The full R12.4 million
impairment recognised during FY2014 relates to the exploration assets in the Ergo operating segment associated with Ergo phase
2, being the uranium processing plant that is not considered to be economically viable given current uranium prices. The R61
million recognised during FY2013 was due to the reassessment of the viability of these assets and projects (R40 million for
surface dumps, R12.4 million for plant and equipment and R8.6 million against shaft and infrastructure).

The group recorded an impairment of R46.9 million (2013: R101.3 million) against available-for-sale financial assets (refer note
10).

Listed investments (R6.7 million, refer note 10):
The recoverable amount (fair value less cost to sell) of the financial asset has remained significantly lower than its original cost
price for a prolonged period. This relates to the company’s investment in Village Main Reef Limited (R5.3 million) and West
Wits Mining Limited (R1.4 million).

Unlisted investments (R40.2 million, refer note 10):
Following the adoption of a new Enterprise Resource Planning (ERP) system in 2013, Rand Refinery experienced
implementation difficulties which led to a difference between the actual inventory and the accounting records of approximately
87 000oz of gold.

Due to the uncertainty around Rand Refinery’s inventory and the time it is taking to resolve this matter, the group has assumed
that the 87 000oz gold shortfall will not be recovered.

F-38

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

4. RESULTS FROM OPERATING ACTIVITIES
include the following: (continued)

The shareholders of Rand Refinery have offered financial support in the form of an irrevocable subordinated loan of up to R1.2
billion (the “facility”). Rand Refinery can only draw on the Facility when there is confirmation that an actual gold shortfall
exists.

DRDGOLD declined the option to provide funding on a pro-rate basis with other shareholders. Should it elect not provide such
funding, its shareholding will be diluted, if other shareholders provide funding.

Management therefore estimated the fair value of the investment in Rand Refinery shares as zero. The accumulated revaluations
recognised in Other Comprehensive Income has been derecognised and the initial cost of the investment has been recognised as
an impairment in profit or loss for the year.

During FY2014, the group recorded a reversal of an impairment of R2.7 million against the investment in West Wits SA
Proprietary Limited due to the disposal of the shares for an interest in West Wits Mining Limited at an amount in excess of the
original acquisition cost (refer to note 12).

During FY2013 the group derecognised the DRDGOLD rehabilitation trust fund of R25.6 million due to the relinquishment of the
fund to the buyer of the relating mining rights over the Durban Roodepoort Deep mine area.

During the year ended June 30, 2012, the group derecognised R1.1 million against West Witwatersrand Gold Mines Proprietary
Limited’s rehabilitation trust fund due to the relinquishment of the fund to the buyer of the relating mining rights over the West
Wits mining lease area.

2014

2013

Restated

2012

Restated

R’000

Operating leases

(2,531)

(2,021)

(1,939)

Mining royalties

(16)

(30)

(4,739)

5. FINANCE INCOME

Dividends received

32,470

Interest received

15,740

24,027

16,109

Realised foreign exchange gains

Profit on disposal of equity accounted investment (refer note 12)

2,546

Net gain on disposal of available-for-sale financial asset reclassified from
other comprehensive income

6,656

Growth in environmental rehabilitation trust funds (refer note 10)

4,618

5,590

8,317

Growth in reimbursive right (refer note 10)

5,071

3,905

2,426

27,980

65,992

33,546

6. FINANCE EXPENSES

Interest paid on loans and bank overdrafts

(17,810)

(19,384)

(7,673)

Unwinding of provision for environmental rehabilitation (refer note 17)

(38,019)

(33,537)

(7,292)

Unwinding of discount on financial liabilities measured at amortized cost

(659)

Net loss on financial liabilities measured at amortized cost

(6,372)

Borrowing costs capitalized (refer note 9)

3,534

10,946

4,290

(52,295)

(41,975)

(17,706)

F-39

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

2014

2013

Restated

2012

Restated

R’000

7. INCOME TAX

Mining tax

(9,724)

(53,264)

13,079

Non-mining tax

(7,824)

(7,664)

(6,753)

Secondary tax on companies

(4,544)

(17,548)

(60,928)

1,782

Comprising:
South African

Current tax - current year

(6,755)

(4,187)

(149)

- prior year

334

(25)

Deferred tax

(11,127)

(56,716)

6,475

Secondary tax on companies

(4,544)

(17,548)

(60,928)

1,782

In South Africa, mining tax on mining income is determined based on a formula which takes into account the profit and revenue
from a gold mining company during the year. Non-mining income, which consists primarily of interest, is taxed at a standard
rate of 28% (2013: 28% and 2012: 28%).

The tax rates applicable to mining and non-mining income of a gold mining company previously depended on whether the
company elected to be exempt from Secondary Tax on Companies (STC). STC was a tax on dividends declared, which was
payable by the company declaring the dividend of which the STC tax rate was equal to 10% of the amount of income declared
as a dividend. In 1993, all existing gold mining companies had the option to elect to be exempt from STC. If the election was
made, a higher tax rate would apply to both mining and non-mining income. With the exception of Crown, all of the South
African subsidiaries elected not to be exempt from STC. On April 1, 2012, STC was replaced by a dividend tax of 15%, which is
levied on the beneficial owner of the share. As a result of the new dividends tax there is now a single mining and non-mining tax
rate for gold mining companies for the year ended June 30, 2012 onwards.

The tax rates for taxable mining and non-mining income for companies were 34% and 28%, respectively during FY2013,
FY2014 and FY 2012.

The formula for determining the South African gold mining tax rate for FY2014, FY2013 and FY 2012 is: 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.

For deferred tax purposes the group applies the expected average effective tax rate. The average effective tax rates for the
respective operations are based on the group’s current estimate when temporary differences will reverse. Depending on the
profitability of the operations, the tax rate can consequently be significantly different from year to year.

If a one percentage point increase in the average effective tax rate is applied it would increase the movement in deferred
tax in the statement of profit or loss by R6.3 million to R17.4 million debit.

Each company is taxed as a separate entity and no tax set-off is allowed between the companies.

All mining capital expenditure is deducted to the extent that it does not result in an assessed loss and depreciation is ignored
when calculating the mining income. Capital expenditure not deducted from mining income is carried forward as unredeemed
capital expenditure to be deducted from future mining income.

Ergo is treated as one tax paying operation pursuant to the relevant ring-fencing legislation.

F-40

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

7. INCOME TAX (continued)

2014

2013

Restated

2012

Restated

R’000

Estimated unredeemed capital expenditure at year-end (available for deduction
against future mining income)

1,672,506

1,629,438

1,693,444

Estimated gross capital losses at year end (available to reduce future capital
gains)

1,392,642

1,394,339

1,399,339

Estimated assessed tax losses at year-end (available to reduce future taxable
income)

137,803

86,107

128,350

Estimated tax losses and unredeemed capital expenditure carried forward

3,202,951

3,109,884

3,221,133

Tax reconciliation
Major items causing the group's income tax provision to differ from the
statutory rate were:

Tax on net loss/(profit) before tax at South African corporate tax rate of 28%

10,409

(44,404)

(107,395)

Rate adjustment to reflect the actual realized company tax rates

5,105

27,101

34,273

Deferred tax rate adjustment

(4,947)

(9,354)

15,940

Non-deductable expenditure (a)

(22,012)

(46,323)

(7,339)

Exempt income (b)

1,276

16,006

8,034

Additional tax benefit relating to the prior year (c)

(25)

25,367

Tax incentives

725

1,291

439

Secondary tax on companies

(4,544)

Temporary differences including tax losses recognized for which deferred tax
assets were previously unrecognized (d)

475

2,874

28,343

Current year losses for which no deferred tax was recognized

(8,579)

(13,070)

(2,702)

Other

4,976

11,366

Income tax charge

(17,548)

(60,928)

1,782

(a) The group’s non-deductible expenditure for the year ended June 30, 2014 includes R46.9 million (2013: R101.3 million)

relating to the impairment of available-for-sale financial assets (refer to note 4) and share of losses of equity accounted
investments of R0.3 million (2013: R50.1 million).

(b) Included in the group’s exempt income for the year ended June 30, 2014 are:

– R2.7 million relating to the reversal of the impairment of the investment in West Wits SA Proprietary Limited; and
– R0.8 million relating to the R2.54 million profit on disposal of the investment in West Wits SA Proprietary Limited of
which 33.3% is excluded for capital gains tax. The 66.6% that has been included for capital gains tax have utilised
capital losses that were previously unrecognised.

Included in the group’s exempt income for the year ended June 30, 2013 were R32.5 million relating to dividends from
local companies.

(c) Included in the group’s additional tax benefit relating to the year ended June 30, 2012, is R25.3 million relating to net

foreign exchange losses of the company.

(d) Included in the group’s temporary differences including tax losses recognized for which deferred tax assets were

previously unrecognized for the year ended June 30, 2012, are the assessed losses and unredeemed capital expenditure
for Ergo Mining Proprietary Limited which were previously not raised amounting to R26.9 million.

F-41

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

8. EARNINGS PER SHARE

Basic
The calculation of earnings per ordinary share is based on the following:

Basic (loss)/earnings attributable to equity owners of the parent

(45,808)

49,420

294,313

Basic (loss)/earnings from continuing operations attributable to equity
owners of the parent

(45,808)

49,420

202,939

Basic (loss)/earnings from discontinued operations attributable to equity
owners of the parent

91,374

Weighted average number of ordinary shares in issue adjusted for treasury
shares

379,209,441

379,178,208

384,169,915

Diluted

Diluted basic (loss)/earnings

(45,808)

49,420

294,313

Diluted basic (loss)/earnings from continuing operations attributable to
equity owners of the parent

(45,808)

49,420

202,939

Diluted basic (loss)/earnings from discontinued operations attributable to
equity owners of the parent

91,374

Reconciliation of weighted average number of ordinary shares to diluted
weighted average number of ordinary shares
Weighted average number of ordinary shares in issue

379,209,441

379,178,208

384,169,915

Number of staff options allocated

802,224

589,693

Diluted weighted average number of ordinary shares

379,209,441

379,980,432

384,759,608

Basic (loss)/earnings per ordinary share (cents)

(12)

Diluted basic (loss)/earnings per ordinary share (cents)

(12)

Basic (loss)/earnings from continuing operations per ordinary share (cents)

(12)

Diluted basic (loss)/earnings from continuing operations per ordinary share
(cents)

(12)

Basic (loss)/earnings from discontinued operations per ordinary share (cents)

Diluted basic (loss)/earnings from discontinued operations per ordinary share
(cents)

At June 30, 2014, 1.2 million options (2013: 0.7 million and 2012: 17.0 million) were excluded from the diluted weighted
average number of ordinary shares calculation as their effect would have been anti-dilutive.

2014

2013

Restated

2012

Restated

R’000

F-42

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

2014

2013

Restated

R’000

9. PROPERTY, PLANT AND EQUIPMENT

Total
Cost

2,702,984

2,532,338

Opening balance

2,532,338

2,185,882

Additions

158,593

368,395

Borrowing costs capitalized

3,534

10,946

Disposals

(900)

(26,486)

Change in estimate of decommissioning asset

10,166

(6,399)

Transferred to non-current assets held-for-sale

(747)

Accumulated depreciation and impairment

(947,481)

(776,005)

Opening balance

(776,005)

(571,309)

Depreciation

(159,999)

(143,766)

Impairment (refer note 4)

(12,377)

(61,043)

Disposals

900

113

Carrying value

1,755,503

1,756,333

Mine property and development
Cost

1,325,761

1,266,171

Opening balance

1,266,171

1,264,163

Additions

26,332

Disposals

(900)

(26,356)

Change in estimate of decommissioning asset

2,032

Transfers between asset categories

61,237

Transferred to non-current assets held-for-sale

(747)

Accumulated depreciation and impairment

(525,451)

(427,617)

Opening balance

(427,617)

(333,858)

Depreciation

(98,734)

(85,164)

Impairment

(8,595)

Disposals

900

Carrying value

800,310

838,554

Mine plant facilities (a)

Cost

1,276,207

1,093,574

Opening balance

1,093,574

743,444

Additions

154,582

339,184

Borrowing costs capitalized (b)

3,534

10,946

Transferred between asset categories

14,351

Change in estimate of decommissioning asset

10,166

Accumulated depreciation and impairment

(390,515)

(332,963)

Opening balance

(332,963)

(224,459)

Depreciation

(57,552)

(56,056)

Impairment

(52,448)

Carrying value

885,692

760,611

F-43

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

2014

2013

Restated

R’000

9. PROPERTY, PLANT AND EQUIPMENT (continued)

Equipment and vehicles

Cost

24,079

20,068

Opening balance

20,068

17,319

Additions

4,011

2,879

Disposals

(130)

Accumulated depreciation and impairment

(19,138)

(15,425)

Opening balance

(15,425)

(12,992)

Depreciation

(3,713)

(2,546)

Disposals

113

Carrying value

4,941

4,643

Exploration Assets (c)
Cost

76,937

152,525

Opening balance

152,525

160,956

Change in estimate of decommissioning asset

(8,431)

Transfers between asset categories

(75,588)

Accumulated depreciation and impairment losses

(12,377)

Opening balance

Impairment

(12,377)

Carrying value

64,560

152,525

(a) Flotation and fine-grind (FFG) circuit

The FFG was commissioned in late December 2013 at a cost of R389 million. Depreciation amounting to R10.8 million
was recognised from this date up to March 2014 resulting in a carrying amount of R378.2 million at this date. Production
was suspended temporarily on April 2, 2014 due to a drop in gold recovery subsequent to the commissioning of the FFG.
This was done to restore the established Low Grade Section to steady state in order to isolate the cause(s) of the erratic
metallurgical performance. A number of small engineering upgrades are being made during this “time-out”. A
depreciation charge of Rnil was recognised from this date up to June 30, 2014 based on zero units being produced (mine
plant facilities are depreciated on a units-of-production basis (refer note 1)). The initial estimate of the remaining useful
life of the plant (based on a units-of-production basis) has therefore decreased by the amount of lost production during
the temporary suspension. The carrying amount of the FFG circuit will be depreciated over the remaining units-of-
production when production recommences.

(b) Borrowing costs are capitalized to qualifying assets at the rate applicable to the specific financing obtained (refer note

20).

(c) At June 30, 2014 the exploration assets relate to the tailings complex that historically formed part of phase two of the

Ergo project which is currently planned to be utilised in surface gold retreatment. Property and plant associated with
phase two of the Ergo project that has been utilised in the construction of the FFG has been transferred to mine
development costs and mine plant facilities. The remaining assets that relate to Ergo Phase 2 were impaired.

F-44

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

2014

2013

Restated

R’000

10. NON-CURRENT INVESTMENTS AND OTHER ASSETS

Listed investments (a)

34,097

34,071

Opening balance

34,071

151,303

Additions

5,246

Impairment (refer note 4)

(6,734)

Fair value adjustment

1,514

(117,232)

Unlisted investments

171

93,484

Opening balance

93,484

20,526

Additions

26,864

Impairment (refer note 4)

(40,180)

Fair value adjustment

(53,140)

46,094

Loan to DRDSA Empowerment Trust (b)

2,592

2,592

Reimbursive right for environmental rehabilitation guarantees (c)

93,709

88,638

Opening balance

88,638

57,323

Contributions

27,410

Growth (refer note 5)

5,071

3,905

Investments in environmental rehabilitation trust funds (d)

82,848

86,356

Opening balance

86,356

106,328

Impairment

(25,562)

Transferred to non-current assets held-for-sale (refer note 15)

(8,126)

Growth (refer note 5)

4,618

5,590

Total non-current investments and other assets

213,417

305,141

(a) On February 11, 2012, DRDGOLD, Village Main Reef Limited (Village) and Business Venture Investments No 1557

Proprietary Limited (a wholly owned subsidiary of Village) entered into a sale of shares and claims agreement, for the
acquisition of DRDGOLD’s entire interest in and claims against Blyvooruitzicht Gold Mining Company Proprietary
Limited (Blyvoor) for R1 and 85 714 286 new ordinary shares of Village.

The Agreement consist of two parts. Part A was completed on June 1, 2012 (date of disposal: which is the date control
passed to Village). The effective date used for recordal of the disposal was May 31, 2012 – for accounting purposes the
end of the financial month. Part B has certain conditions precedent which can be waived in full by Village. These include
the successful conversion of Blyvoor’s old order mining right to a new order mining right under the Mineral and
Petroleum Resources Development Act (Act No. 28 of 2002), and obtaining the consent of the Department of Minerals
and Resources for the sale.

The first of the Part B conditions precedent being the notarial execution and registration of the new order mining rights
after Blyvoor successfully applied for the conversion of the rights, became due during the year ended June 30, 2014 but
is in dispute at June 30, 2014. This matter has been referred for simultaneous expert determination and arbitration for
which no date has been confirmed to date. Management believes that it is more likely than not, that this process will
conclude favourably for the group. Pending the outcome of the above (which will confirm the ownership of the shares),
the 20 000 000 ordinary shares in Village remained in escrow (Escrow Shares).

(b) The terms and conditions of the loans to the DRDSA Empowerment Trust are linked to the payments of dividends from

Ergo Mining Operations Proprietary Limited to the company.

applied towards the settlement of the DRDGOLD group’s environmental rehabilitation obligations under financial
guarantees issued by Guardrisk Insurance Company Limited to the DMR (refer note 17).

(d) The monies in the environmental rehabilitation trust funds are held in the Crown Rehabilitation Trust and are invested

primarily in low-risk interest-bearing debt securities and may only be used for environmental rehabilitation purposes
(refer note 17).

F-45

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

10. NON-CURRENT INVESTMENTS AND OTHER ASSETS (continued)

Fair

Carrying

Number

value

2014

2013

Restated

% Held

shares

R'000

Listed investments consist of:

Village Main Reef Limited

8.49

85,714,286

30,286

34,071

West Wits Mining Limited

12.07

38,250,000

3,811

34,097

34,071

Unlisted investments consist of:

Rand Mutual Assurance Company Limited

†

Rand Refinery Proprietary Limited (refer note 4)

44,438

93,320

Guardrisk Insurance Company Limited (Cell Captive
170)*

†

100

Chamber of Mines Building Company Proprietary
Limited

36,304

171

93,484

† 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
net equity of the cell captive 170.

F-46

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

11. INVESTMENT IN SUBSIDIARIES

Disposal of subsidiary

Elsburg Gold Mining Joint Venture (ErgoGold)

During the year ended June 30, 2013, the company disposed of its 35% interest in ErgoGold to Ergo as part of the group
restructuring on July 1, 2012 for R200 million. Through the disposal, the non-controlling interest obtained an additional 9.1%
effective interest in ErgoGold accounted for as a movement in equity.

Blyvoor

On February 11, 2012, DRDGOLD, Village and Business Venture Investments No 1557 Proprietary Limited (a wholly owned
subsidiary of Village) (Purchaser) entered into a sale of shares and claims agreement (the Agreement), for the acquisition of
DRDGOLD’s entire interest in and claims against Blyvoor for R1 and 85,714,286 new ordinary shares of Village.

The Agreement consists of two parts. Part A was completed on June 1, 2012 (date of disposal: which is the date control passed to
Village). Part B has certain conditions precedent which can be waived in full by Village. These include the successful conversion
of Blyvoor’s old order mining right to a new order mining right under the Mineral and Petroleum Resources Development Act
(Act No. 28 of 2002), as well as obtaining the consent of the DMR for the sale.

Pending the outcome of Part B conditions precedent, 20,000,000 of the newly issued ordinary shares in Village will be kept in
escrow.

The fair value of the proceeds on disposal has been determined after taking into consideration the market close price of Village on
June 1, 2012, of R1.61 per share.

As at

May 31, 2012

R’000

Calculation of loss on disposal of Blyvoor

Fair value of proceeds on disposal

135,332

Less: Consolidated carrying amount attributable to equity owners of the parent

(138,638)

Less: Directly attributable costs

(7,226)

Loss on disposal of discontinued operation

(10,532)

F-47

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

11. INVESTMENT IN SUBSIDIARIES (continued)

The following information relates to the group’s financial interest in its subsidiaries at June 30:

SHARES AT

COST

LESS

IMPAIRMENT

R’000

INDEBTEDNESS

2013

R’000

IMPAIRMENT

2013

R’000

NUMBER OF

SHARES

% HELD

INDEBTED-

NESS

2014

R’000

IMPAIR-

MENT

2014

R’000

Subsidiaries directly held

Ergo Mining Operations Proprietary
Limited

1,000,000

113,177

649,498

544,747

Argonaut Financial Services

Proprietary Limited

100

(1,055)

Crown Consolidated Gold Recoveries

Limited

51,300,000

100

(245,316)

Hartebeestfontein Gold Mining

Company Limited

100

Rand Leases (Vogelstruisfontein) Gold

Mining Company Limited

118,505,000

100

(42,092)

Roodepoort Gold Mine Proprietary

Limited

100

West Witwatersrand Gold Holdings

Limited

99,000,000

100

(22,996)

Total

113,117

338,039

233,288

Other subsidiaries

Ergo Mining Proprietary Limited

599,213

662,412

West Witwatersrand Gold Mines

Limited

143,920

(143,920)

143,920

(143,920)

Total

743,133

(143,920)

806,332

(143,920)

As at June 30, 2014 and June 30, 2013

Ergo Mining Operations Proprietary Limited (EMO) holds the following interests in other entities:100% of East Rand Proprietary Mines Limited (ERPM),

100% of Crown Gold Recoveries Proprietary Limited (Crown) and 100% of Ergo Mining Proprietary Limited (Ergo). EMO does not hold any ownership
interest in the Crown Rehabilitation Trust or the Ergo Business Development Academy NPC, but controls these entities by way of the terms of the constituting
documents that grants the EMO group the ability to direct its relevant activities, as well as the group receiving substantially all of the returns related to their
operation.

The company has subordinated its claim against these subsidiaries in favour of all other creditors

F-48

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

2014

2013

Restated

R’000

12. EQUITY ACCOUNTED INVESTMENTS
12.1 JOINT VENTURES

Chizim Gold (Pvt) Limited (Chizim Gold)

During the year ended June 30, 2011 the group acquired a 50% interest in Chizim Gold,
located in Zimbabwe for a nominal cash consideration pursuant to a joint venture agreement
entered into on 9 December 2009. On 7 June 2013, a shareholders agreement was entered
reducing the company’s shareholding to 49%.

Percentage held

49%

Net investment in joint venture

Opening balance

313

27,368

Cost

50,448

27,368

Accumulated equity accounted losses

(50,135)

Advance to equity accounted investment

13,946

Share of losses of equity accounted investments (a)

(313)

(50,135)

Share of other comprehensive income of equity accounted investments (b)

9,134

Closing balance

313

Cost

50,448

50,448

Accumulated equity accounted losses

(50,448)

(50,135)

(a) The share of losses of equity accounted investments relate to impairments recognised at Chizim Gold level. On June 30,

2013 the entity stopped conducting feasibility studies on certain exploration tenements in Zimbabwe. On this date the
group recognised the impairment of the non-current exploration assets through its share of the equity accounted losses of
the investee. The remaining net current assets were impaired during the year ended June 30, 2014.

(b) The share of other comprehensive income of equity accounted investments arose on the translation of the financial

statements of the investee (refer note 16.1).

F-49

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

2014

2013

Restated

R’000

12. EQUITY ACCOUNTED INVESTMENTS (continued)
12.2 ASSOCIATES

West Wits SA Proprietary Limited - percentage held

28.33%

During FY2014 DRDGOLD exercised its option under the agreement dated 7 November
2007 with various capital vendors to convert its 28.33% investment in West Wits SA
Proprietary Limited into shares in West Wits Mining Limited.

DRDGOLD therefore reversed the R2.7 million impairment (refer note 4), derecognised the
investment West Wits SA Proprietary Limited, and recognised a profit on the disposal of
equity accounted investment of R2.5 million (refer note 6), and recognised 38 250 000 shares
with a fair value of R5.2 million in West Wits Mining Limited (refer note 10).

Net investment in associate

Opening balance

Cost

2,700

2,700

Accumulated equity accounted losses/impairment

(2,700)

(2,700)

Reversal of impairment

2,700

Disposals

(2,700)

Closing balance

Cost

Accumulated equity accounted losses /impairment

Carrying value of equity accounted investments

313

F-50

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

2014

2013

Restated

R’000

13. INVENTORIES
Gold in process

43,033

35,037

Consumable stores

88,541

73,428

Finished stock - bullion

15,615

30,382

Total inventories

147,189

138,847

Inventory includes gold in process carried at net realizable value amounting to R2.4 million (2013: R31.7 million) and finished
stock – bullion amounting to R1.9 million (2013: R21.9 million).

14. TRADE AND OTHER RECEIVABLES

Trade receivables (gold)

25,630

30,415

Value added tax

20,609

17,110

Prepayments

3,088

403

Receivables from related parties

2,992

177

Interest receivable

1,027

1,646

Other receivables (a)

53,158

39,343

Allowance for impairment

(6,981)

(6,360)

99,523

82,734

(a) Included in other receivables are receivables relating to property sales amounting to R19.9 million (2013: R22.5 million).

15. ASSETS AND LIABILITIES HELD FOR SALE

In line with the group’s strategy to exit underground mining operations, management
committed to a plan to sell certain of the underground mining and prospecting rights held by
ERPM including the related liabilities during FY2014. Accordingly these assets and liabilities
are presented as a disposal group held-for-sale.

A sale is expected within 12 months, but regulatory approvals required for transactions of this
nature may result in the sale taking place more than 12 months after reporting date.

As at June 30, 2014 the disposal group was stated at the historic carrying amount being the
lower of carrying amount or fair value less costs to sell and was included within corporate
office and other reconciling items for operating segment reporting purposes (refer note 2).

Assets held-for-sale

Property, plant and equipment

747

Non-current investments and other assets

8,126

8,873

Liabilities held-for-sale

Provision for environmental rehabilitation

20,530

F-51

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

2014

2013

Restated

2012

Restated

R’000

16. EQUITY
16.1 EQUITY OF THE OWNERS OF THE PARENT

Details of equity of the owners of the parent are provided in the statements

of changes in equity

Authorized share capital

600,000,000 (2013 and 2012: 600,000,000) ordinary shares of no par value

5,000,000 (2013 and 2012: 5,000,000) cumulative preference

shares of 10 cents each

500

500

Issued share capital

385,383,767 (2013 and 2012: 385,383,767) ordinary shares of no par value

4,132,627

4,133,687

4,133,867

6,155,559 (2013: 6,205,559, 2012: 6,285,173) treasury shares held within
the group

(44,153)

(44,400)

(44,750)

5,000,000 (2013: 5,000,000 and 2012) cumulative preference shares

of 10 cents each

500

500

4,088,974

4,089,787

4,089,617

Share capital
Unissued shares
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.

Cumulative preference shares
The terms of issue of the cumulative preference shares were that they carried 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 Argonaut's
mineral rights acquired from Randgold and Exploration Company Limited in September 1997. The DMR granted DRDGOLD a
prospecting right over an area which was going to be too small to mine. When an application for a greater area was lodged, the
DMR stated that the additional area is in an urban location and an application for a prospecting right could not be granted. The
company is in the process of consulting with the relevant preference shareholder to cancel these preference shares.

2014

2013

Restated

2012

Restated

R’000

Revaluation and other reserves

Foreign exchange translation reserve (a)

5,882

5,882

(3,252)

Asset revaluation reserve (b)

136,587

186,459

152,840

Share-based payments reserve (c)

30,387

32,601

55,487

172,856

224,942

205,075

F-52

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

16. EQUITY (continued)
16.1 EQUITY OF THE OWNERS OF THE PARENT (continued)

(a) The foreign exchange translation reserve represents the cumulative translation effect arising on the translation of the

financial statements of the company’s foreign operations.

(b) On the acquisition of ErgoGold in FY2009 an amount of R133.3 million was taken to the asset revaluation reserve. This

amount represented the increase in the fair value of ErgoGold's net assets after the acquisition of the group's initial interest,
which is attributable to that initial interest.

The fair value adjustment on available-for-sale investments at June 30, 2014 related to the investment in Village Main Reef
Limited amounting to R1.5 million.

The fair value adjustment on the available-for-sale investments at June 30, 2013 related to the investment in Village Main
Reef Limited and amounted to R117.2 million loss. The cumulative fair value adjustment has been reclassified as an
impairment through profit or loss amounting to R101.3 million.

The fair value adjustment on the available-for-sale investments at June 30, 2012 related to the investment in Village Main
Reef Limited and amounted to R11.5 million gain.

The cumulative fair value reserve on the available-for-sale investment relating to the investment in Rand Refinery
Proprietary Limited for FY2014 amounted to Rnil (2013: R53.2 million, 2012: R8.0 million).

million (2013: R24.1 million, 2012: R nil) (refer to note 18).

2014

2013

Restated

2012

Restated

R’000

Dividends
The following dividends were declared and paid by the group:
14 cents per qualifying ordinary share (2013: 24 cents and 2012: 7.5 cents)

(53,085)

(91,004)

(28,872)

After June 30, 2014, a dividend of 2 cents per qualifying share (R7.7 million) was approved by the directors as a final dividend
for FY2014. The dividend has not been provided for and does not have any tax impact on the company. Dividend withholding tax
is levied at 15% (2013: 15%, 2012: 15%) (certain exemptions apply) and will be withheld from the dividend depending on the
classification of the beneficial owner of the relevant share.

F-53

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

16. EQUITY (continued)
16.2 NON CONTROLLING INTEREST

The following table summarises the information relating to each of the group’s subsidiaries that have material NCI, before any

intra-group eliminations:

2014

2013 Restated

EMO

Intra-group

elimination

Total

EMO

Intra-group

eliminations

Total

and

consolidation

entries

R’000

NCI percentage

26%

26%

Non-current assets

1 940 218

1 965 824

Current assets

263 818

289 814

Non-current liabilities

575 498

638 178

Current liabilities

1 012 419

946 786

Net assets

616 119

670 674

Carrying amount of NCI

160 191

71 949

232 140

174 375

68 434

242 809

Revenue

1 809 434

2 076 496

(Loss)/profit after tax

(34 290)

185 533

OCI

(6 745)

3 658

Total comprehensive income

(41 035)

189 191

(Loss)/profit allocated to NCI

(8 915)

–

(8 915)

48 238

–

48 238

OCI allocated to NCI

(1 754)

–

(1 754)

951

–

951

Cash flows from operating activities

132 970

428 478

Cash flows from investing activities

(168 118)

(339 354)

Cash flows from financing activities

(17 006)

(91 090)

Net decrease in cash and cash equivalents

(52 154)

(1 966)

Dividends paid

–

15 736

Ergo Mining Operations Proprietary Limited (EMO)

Roll-up of Non-Controlling Interest
Khumo Gold SPV Proprietary Limited (Khumo) and the DRDSA Empowerment Trust, DRDGOLD’s Black Economic
Empowerment (BEE) partners, currently hold their respective investments of 20% and 6% in Ergo Mining Operations Proprietary
Limited (EMO).

During March 2014 these BEE partners signed an agreement with DRDGOLD to sell their shares in EMO to DRDGOLD for a
total consideration of 45.5 million new shares issued by DRDGOLD at a value of R191.1 million. This agreement was approved
at a general meeting of the shareholders on June 27, 2014.

The transaction will become effective when the last suspensive condition, being the Section 102 approval by the Department of
Mineral Resources (DMR) has been met.

The successful implementation of the transaction will result in the streamlining and simplification of DRDGOLD’s corporate and
financial reporting structures and EMO will be fully consolidated into DRDGOLD’s financial results.

F-54

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

2014

2013

Restated

R’000

17. PROVISION FOR ENVIRONMENTAL REHABILITATION

Opening balance

524,323

504,327

Increase/(decrease) in provision (refer note 9)

10,166

(6,399)

Unwinding of provision (refer note 6)

38,019

33,537

Environmental rehabilitation payments

(14,170)

(22,476)

(Benefit)/charge to profit or loss

(86,605)

15,334

Transferred to non-current liabilities held-for-sale

(20,530)

Closing balance

451,203

524,323

Amounts have been contributed to irrevocable trusts and guarantees have been provided to the DMR (refer to note 10 and note
26).

The company intends to fund the ultimate rehabilitation costs from the money invested with the trust funds together with the
Guardrisk Cell Captive as well as, at the time of mine closure, the proceeds on sale of remaining assets and gold from plant clean-
up. The rehabilitation is expected to occur progressively towards the end-of-life of the respective dumps mined.

Movement in provision for environmental rehabilitation
A benefit to profit or loss amounting to R86.6 million was recognised resulting from a decrease in the estimated cost to
rehabilitate. This is based on the implementation of a different technique to vegetate the Crown complex as well as the increased
use of “grey water” in rehabilitation. An updated survey and work performed during the year resulted in a decrease of the area to
be vegetated.

F-55

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

18. POST-RETIREMENT AND OTHER EMPLOYEE BENEFITS

2014

2013

Restated

R’000

Non-current post-retirement and other employee benefits
Liability for post-retirement medical benefits (a)

6,657

6,322

Liability for long term employee incentive scheme (b)

2,618

2,331

9,275

8,653

Current post-retirement and other employee benefits
Liability for long term employee incentive scheme (b)

1,958

1,018

1,958

1,018

Contribution funds

The group participates in a number of multi-employer, industry-based retirement plans. All plans are governed by the
Pension Funds Act, 1956.

The group pays fixed contributions to external institutions and has no legal or constructive obligation to pay further
amounts.

2014

2013

Restated

R’000

Amounts recognized in profit or loss are as follows:

Contribution payments

(19,611)

(16,246)

(a) Post-retirement medical benefits

A provision for post-retirement medical benefits has been raised, based on the latest calculations using a projected unit credit
method, of independent actuaries performed as at June 30, 2012. Post-retirement medical benefits are actuarially valued
every three years. The obligation is unfunded.

2014

2013

Restated

R’000

Amounts recognized in the statement of financial position are as follows:

Opening balance

6,322

5,972

Current service cost

Benefits paid

(261)

(282)

Interest costs

512

540

Closing balance

6,657

6,322

Amounts recognized in profit or loss are as follows:

Current service cost and interest

(84)

(92)

Interest costs

(512)

(540)

(596)

(632)

Principal actuarial assumptions at June 30, are:
Health care cost inflation

7.8%

7.8%

Discount rate

8.8%

8.8%

Real discount rate

0.9%

0.9%

Normal retirement age

Expected average retirement age

60.3

60.3

Spouse age gap

3 years

3 years

Continuation at retirement

100%

100%

Proportion married at retirement

85%

85%

F-56

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

18. POST-RETIREMENT AND OTHER EMPLOYEE BENEFITS (continued)

Assuming all other variables remain constant a one percentage change in the stated assumptions would have the following effects:

Variation

Health care cost

inflation

Mortality

Resignation

rate

100 bp

R’000

Effect on the aggregated

+1%

(58)

(4)

service and interest cost

-1%

(57)

Effect in past-service

+1%

772

(679)

(33)

contractual liability

-1%

(659)

792

The group expects to pay contributions of R0.3 million during FY2015.

(b) Liability for long term employee incentive scheme

2014

2013

Restated

R’000

Opening balance

3,349

Increase in liability current year

2,821

3,349

Benefits paid

(1,594)

Total liability of employee incentive scheme

4,576

3,349

Short term portion of employee incentive scheme

(1,958)

(1,018)

Long term portion of employee incentive scheme

2,618

2,331

DRDGOLD Phantom Share Scheme

i) Details of the DRDGOLD phantom share scheme
The company operates a phantom share scheme, DRDGOLD Phantom Share Scheme, (the Phantom Share Scheme), as an
incentive tool for its executive directors and senior employees whose skills and experience are recognised as being essential to the
company’s performance. The Phantom Share Scheme was introduced during FY2013 and is classified as cash settled. In terms of
the Phantom Share Scheme rules, 50% of the phantom share granted will be valued based on the group meeting certain pre-
determined performance criteria and the remaining 50% to defined retention periods of which the maximum incentive pay-out per
annum to any single employee may not exceed 75% of that employee’s gross remuneration package. The participants in the
scheme are fully taxed at their marginal tax rate on any gains realised on the exercise of their options.

The phantom share granted has a zero base value however, the number of options granted is determined by price in respect of
each share which is the subject of the option, the volume weighted average price of a share on the JSE for the seven days on
which the JSE is open for trading, preceding the day on which the employee is granted the option. The allocation date will be the
date when the directors approve allocation of share options. Each option remains in force until the date of vesting, subject to the
terms of the option plan.

Phantom shares granted under the Phantom Share Scheme vest primarily according to the following schedule over a maximum of
a three year period:

Percentage vested in each period grant:

Period after the original date of grant of the
option:

Performance criteria

Retention criteria

33.3%

one

year

33.3%

50%

two years

33.3%

50%

three years

F-57

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

18. POST-RETIREMENT AND OTHER EMPLOYEE BENEFITS (continued)

Phantom share scheme (continued)

ii) Share option activity: DRDGOLD Phantom Share Scheme

Outstanding

Number of

shares

Average price

per share R

Balance at June 30, 2012

Granted

3,019,549

6.01

Balance at June 30, 2013

3,019,549

3.90

Granted

1,964,033

1.18

Exercised

(477,480)

3.27

Forfeited

(800,000)

3.27

Balance at June 30, 2014

3,706,102

2.64

Phantom shares granted are initially measured at fair value on grant date and subsequently on each reporting date. This fair value
is recognized as an employee expense over the vesting period, adjusted to reflect actual levels of vesting, with the corresponding
credit to an employee benefit liability, which is part of non-current and current liabilities.

Analysis of phantom share options:

Year granted

Years

Unvested

to expiry

June 30, 2015

June 30, 2016

June 30, 2017

2013

1 – 2

1,041,373

848,238

2014

1 – 3

327,344

744,583

744,564

Total

1,368,717

1,592,821

744,564

2014

2013

iii) The fair value of the DRDGOLD phantom shares are determined using the Black - Scholes option valuation model

Significant inputs into the model were:

Market price at date of grant (rand per share)

October 31, 2012 grant

6.08

6.08

October 31, 2013 grant

5.10

Vesting periods (years)

October 31, 2012 grant

October 31, 2013 grant

Volume weighted average price at date of grant (Rand per share)
October 31, 2012 grant

6.20

6.20

October 31, 2013 grant

4.98

Volume weighted average price at financial year end (Rand per share)
October 31, 2012 grant

3.16

5.48

October 31, 2013 grant

3.16

Average risk-free rate

October 31, 2012 grant

6.27%

5.85%

October 31, 2013 grant

6.68%

Average volatility

(1)

October 31, 2012 grant

18%

16%

October 31, 2013 grant

22%

F-58

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

18. POST-RETIREMENT AND OTHER EMPLOYEE BENEFITS (continued)

Phantom share scheme (continued)

2014

2013

iv) The performance criteria of the phantom shares determined
against the group performance:

Return on equity (minimum required)

October 31, 2012 grant

15%

October 31, 2013 grant

15%

Headline earnings per share (minimum required) (cent per share)

October 31, 2012 grant

0.25

0.64

October 31, 2013 grant

0.25

Share price performance (minimum required) (JSE index)
October 31, 2012 grant

J150

October 31, 2013 grant

J150

Free cash flow margin (minimum required)

October 31, 2012 grant

10%

October 31, 2013 grant

10%

(1)

The volatility is measured at the standard deviation of the expected share price returns and is based on statistical analysis of daily share prices over the
last three years.

Share option scheme

i) Details of the DRDGOLD (1996) share scheme

During FY2013, the company introduced a new incentive tool called the DRDGOLD Phantom Share Scheme which will replace
the Share Option Scheme and no new share options will be granted under the replaced scheme.

During the year ended June 30, 2014 the company made an offer to buy-out only the share options that have vested at the date of
the offer. This offer was made at fair value based on the Black-Scholes option valuation model amounting to R2.7 million (2013:
R24.1 million) and was accepted by all the participants.

The rules of the DRDGOLD (1996) share scheme do not grant employees the choice of settlement of their vested share options in
cash or equity instruments. Communications with the participants regarding the buy-out were unambiguous in stating that no
further offer to buy out share options, whether vested or unvested, were promised in the future.

No intention currently exists to make any further offers to buy out any share options, whether vested or unvested. As a result no
constructive obligation for further buy outs of share options exist for which the recognition of a liability is required.
Any options not exercised within a period of five years (issued prior to 2009: 10 years) from the original date of granting the
option will expire and may not thereafter be exercised.

F-59

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

18. POST-RETIREMENT AND OTHER EMPLOYEE BENEFITS (continued)

Share option scheme (continued)

ii) Share options activity DRDGOLD (1996) Share Scheme:

Outstanding

Average
price per

Number of

share

shares

Balance at June 30, 2012

19,624,585

7.32

Exercised

(14,699,280)

6.61

Forfeited/lapsed

(1,269,948)

17.36

Balance at June 30, 2013

3,655,357

6.68

Exercised)

(1,836,761)

6.98

Forfeited/lapsed

(580,568)

7.06

Balance at June 30, 2014

1,238,028

5.96

Options to acquire the company’s ordinary shares that were granted post November 7, 2002 and which remain unvested at
January 1, 2005, are measured at fair value at grant date. This fair value is recognized as an employee expense over the vesting
period, adjusted to reflect actual levels of vesting, with the corresponding credit to a revaluation and other reserve, which is part
of equity.

Analysis of share options:

Range of exercise prices

Years

Vested

Unvested

to expiry

June 30, 2014

June 30, 2015

R5>R10

–

102,278

958,250

R10>R15

–

177,500

Total

279,778

958,250

2014

2013

iii) The fair value of the options of the DRDGOLD (1996) share scheme are determined
using the Black - Scholes option valuation model.

Significant inputs into the model were:

Market price at date of grant (rand per share)

October 18, 2010 option grant

3.66

3.66

November 2, 2011 option grant

5.26

5.26

Vesting periods (years)

October 18, 2010 option grant

November 2, 2011 option grant

Option strike price (rand per share)
October 18, 2010 option grant

3.69

3.69

November 2, 2011 option grant

5.12

5.12

Risk-free rate

October 18, 2010 option grant

6.74%

6.74%

November 2, 2011 option grant

6.75%

6.75%

Volatility

(1)

October 18, 2010 option grant

31%

31%

November 2, 2011 option grant

34%

34%

(1) The volatility is measured at the standard deviation of the expected share price returns and is based on statistical analysis of daily share prices over the last

three years.

F-60

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

19. DEFERRED TAX

2014

2013

Restated

R’000

Balances arose from the following temporary differences:

Deferred tax asset
Property, plant and equipment

(4)

(5)

Provisions, including rehabilitation provision

1,428

2,894

1,424

2,889

Deferred tax liability
Property, plant and equipment

(186,770)

(185,832)

Provisions, including rehabilitation provision

69,389

75,701

Other temporary differences

1,297

3,709

(116,084)

(106,422)

Net deferred mining and income tax liability

(114,660)

(103,533)

Reconciliation between deferred taxation opening and closing balances
Opening balance

(103,533)

(51,289)

Recognized in other comprehensive income

4,471

Investments

4,471

Profit or loss (expense)/credit

(11,127)

(56,715)

Property, plant and equipment

(937)

(61,405)

Provisions, including rehabilitation provision

(7,778)

19,925

Estimated assessed losses

(16,836)

Other temporary differences

(2,412)

1,601

Closing balance

(114,660)

(103,533)

The group provides for deferred tax at the rates which are expected to apply for temporary differences. The group uses the
expected average effective tax rates, resulting from the mining tax formula for mining income based on forecasts per individual
entity. If a one percentage point increase in the effective tax rate is applied the deferred tax liability would amount to R122.3
million compared to the current R116.0 million (refer note 7).

Deferred tax assets have not been recognised in respect of tax losses of R38.6 million (2013: R24.1 million), unredeemed capital
expenditure of R292.0 million (2013 Restated: R295.2 million) and capital losses of R258.6 million (2013: R260.3 million).

The deferred tax relating to the company’s investment in subsidiaries and equity accounted investments is Rnil (2013: Rnil)
because these investments are to be realised through dividend distributions which are exempt under current tax legislation. As a
result there are also no temporary differences.

F-61

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

20. LOANS AND BORROWINGS

2014

2013

Restated

R’000

Unsecured
Domestic Medium Term Note Programme

148,695

167,626

148,695

167,626

Less: payable within one year included under current liabilities

(73,195)

(24,294)

75,500

143,332

Loans and borrowings expected repayment schedule for capital amounts payable in
the 12 months to:
June 30, 2014

24,294

June 30, 2015

73,195

67,832

June 30, 2016

75,500

75,500

148,695

167,626

Analysis of gross loans and borrowings by currency:
South African Rand

148,695

167,626

Effective interest rates:
Unsecured liabilities

Domestic Medium Term Note Programme

8.9%-10.6%

9.1%-10.2%

During June 2012 the group entered into a Domestic Medium Term Note Programme (DMTN Programme) with ABSA Capital, a
division of ABSA Bank Limited, under which DRDGOLD may from time to time issue notes and R165 million was raised in
total during July 2012 and September 2012. The different notes issued mature 12 (R20.0 million), 24 (R69.5 million) and 36
(R75.5 million) months from the date of issue and bear interest at the three-month Johannesburg Inter-bank Acceptance Rate
(JIBAR) plus a margin ranging from 4% to 5% a year.

The DMTN Programme is unsecured but does have certain covenants attached to it regarding acquiring additional indebtedness,
significant disposal of assets and in the form of a guarantor coverage threshold. During FY2013, the group settled the last
unsecured notes issued under the previous DMTN Programme which had a 24-month term and carried interest at the three-month
JIBAR plus 5%.

On July 3, 2014, DRDGOLD repaid R73.2 million including capital and interest.

F-62

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

21. CASH GENERATED BY OPERATIONS

2014

2013

Restated

2012

Restated

R’000

(Loss)/profit before taxation

(37,175)

158,586

383,552

Adjusted for:

Depreciation

159,999

143,766

120,850

Movement in provision for environmental rehabilitation

(86,605)

15,334

59,185

Movement in gold in process

8,828

(17,727)

(14,710)

Impairments

56,591

187,866

1,100

(Profit)/loss on disposal of property, plant and equipment

(992)

(19,267)

9,556

Share-based payments

3,341

4,515

4,133

(Reversal of impairment)/impairment loss on trade receivables

(2,172)

(1,412)

554

Share of losses of equity accounted investments

313

50,135

Actuarial loss on post-retirement and employee benefits

Post-retirement and other employee benefits

335

350

(389)

Dividends received

(32,470)

(38)

Finance income

(27,980)

(33,522)

(33,508)

Finance expenses

52,295

41,975

17,706

Operating cash flows before working capital changes

126,778

498,129

548,058

Working capital changes

(39,394)

(55,808)

63,492

Change in trade and other receivables

(15,233)

(18,852)

33,583

Change in inventories

(17,170)

(19,510)

(3,328)

Change in trade and other payables

(6,991)

(17,446)

33,237

Cash generated by operations

87,384

442,321

611,550

22. CASH FLOW ON DISPOSAL OF SUBSIDIARIES, NET OF CASH DISPOSED

Total net cash flow on disposal of subsidiary

Blyvoor

(9,584)

Disposal of Blyvoor
On June 1, 2012, DRDGOLD disposed of its 74% shareholding in and loan
claims against Blyvoor.

Effect of disposal on the financial position of the group:

Property, plant and equipment

114,374

Non-current investments and other assets

46,989

Inventories

36,508

Trade and other receivables

32,679

Cash and cash equivalents

2,358

Provision for environmental rehabilitation

(46,001)

Post-retirement and employee benefits

(568)

Trade and other payables

(145,197)

Consolidated carrying value at time of disposal

41,142

Directly attributable costs

(7,226)

Less: cash and cash equivalents of disposed entity

(2,358)

Cash flow on disposal of subsidiary net of cash disposed

(9,584)

F-63

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

2014

2013

Restated

2012

Restated

R’000

23. CASH AND CASH EQUIVALENTS

Included in cash and cash equivalents is restricted cash of
R13.5 million (2013: R13.0 million, 2012: R20.6 million) in the form of
guarantees.
An overdraft facility of R100 million is available to the group.

Bank balances

39,683

27,275

36,168

Call deposits

169,249

349,376

261,867

208,932

376,651

298,035

2014

2013

Restated

R’000

24. COMMITMENTS AND CONTINGENT LIABILITIES

Capital commitments
Contracted for but not provided for in the financial statements

3,255

12,460

Authorized by the directors but not contracted for

32,979

17,587

36,234

30,047

This capital expenditure will be financed from existing cash resources, cash generated from operations and negotiated funding
facilities.

Operating lease commitments
The group leases its office building in terms of an operating lease. The group does not have an option to acquire the building at
the termination of the lease. There is an escalation of 8% per annum imposed by the lease agreement.

Ergo leases its vehicles under various operating leases. There is an average escalation of 2.5% per annum imposed by these lease
agreements.

The future minimum lease payments under non-cancellable operating leases are as follows:

Not later than 1 year

2,110

1,648

Between 1 and 5 years

1,780

1,781

Financing lease commitments
During FY2014 the group entered into an agreement for the supply of temporary power generation equipment and services. The
lease term will commence during October 2014 for a term of five years at a fixed monthly payment. The group has the option to
acquire the equipment at the termination of the lease.

Future minimum lease payments under non-cancellable finance leases are as follows.

The future minimum lease payments under non-cancellable operating leases are as follows:

Not later than 1 year

3,978

Between 1 and 5 years

32,410

F-64

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

24. COMMITMENTS AND CONTINGENT LIABILITIES (continued)

Contingent liabilities

Environmental
At Durban Roodepoort Deep mine, rehabilitation and other responsibilities like the National Nuclear Regulator Certificate of
Registration requirements have been taken over by DRD Proprietary Limited (a subsidiary of Mintails South Africa Proprietary
Limited (Mintails SA)). A liability transfer on the prescribed form in terms of section 43(2) of the MRPDA was submitted to the
DMR in July 2010. The DRD Village was sold to a property developer (Dino Properties Proprietary Limited (Dino Properties)).
The DRD Village was registered at the Deed Office into the name of Dino Properties on October 16, 2012. The legal transfer of
the liability would be dependent on the DMR’s assessment of inter alia Mintail SAs financial capability. DRDGOLD therefore
still has a contingent liability until such legal transfer is effected, amounting to R63.4 million less the trust fund amount of R26.8
million. We are still awaiting approval of the transfer of environmental liabilities from the DMR.

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 is co-disposed onto the Brakpan TSF. Partially treated
water is then discharged by TCTA into the Elsburg Spruit.

While these 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, they are an
encouraging development. In particular, if the spirit of cooperation that led to its conclusion is taken into the implementation and
management of the project, this initiative has every chance of success.

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.

Occupational health - Silicosis
In January 2013 DRDGOLD, ERPM and 23 other mining companies were served with a court application for a class action
issued in the South Gauteng High Court by alleged former mineworkers and dependants of deceased mineworkers. In the pending
application the applicants allege that DRDGOLD, ERPM and other mining companies conducted underground mining operations
in such a negligent manner that the former mineworkers contracted silicosis. The applicants have not yet quantified the amounts
which they would like the mining companies to pay as damages.

DRDGOLD and ERPM have instructed Malan Scholes Attorneys to defend the case. The companies are currently gathering
information in preparation for the matter. An answering affidavit opposing the application for the certification of a class action
was filed with the High Court on June 24, 2014.

Taking into account that the silicosis claim is still at certification stage and should anyone bring similar claims against
DRDGOLD or any of its subsidiaries in future, those claimants would need to provide evidence proving that silicosis was
contracted while in the employment of the company and that it was contracted due to negligence on the company’s part. The link
between the cause (negligence by the company while in its employ) and the effect (the silicosis) will be an essential part of any
case. It is therefore uncertain as to whether the company will incur any costs related to silicosis claims in the future and due to the
limited information available on any claims and potential claims and the uncertainty of the outcome of these claims, no reliable
estimation can be made for the possible obligation.

Dispute with the Ekurhuleni Municipality
The Ekurhuleni Municipality has brought an action against ERPM claiming an amount of R42.0 million in respect of outstanding
rates and taxes which are allegedly owing. As at June 30, 2014, the difference between the invoiced amount and ERPM’s
calculations amounted to R55.8 million. ERPM has employed experts to investigate the allegations and it appears that this claim
is unfounded. ERPM is defending this action and has employed Norton Rose Attorneys to represent it. There are sufficient
defences to repel the claim, therefore an outflow of resources is remote.

F-65

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

25. FINANCIAL INSTRUMENTS

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 27. Further quantitative disclosures are
included throughout these consolidated financial statements.

Risk management framework
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, 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 Audit and Risk Committee 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 Audit
and Risk Committee 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 Audit and Risk
Committee.

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 receivables from customers and investment securities.

The group’s financial instruments do not represent a concentration of credit risk, because the group deals with a variety of major
banks and financial institutions located in South Africa after evaluating the credit ratings of the representative financial
institutions. Furthermore, its trade receivables and loans are regularly monitored and assessed for recoverability. Where it is
appropriate an impairment loss is raised.

In addition, the group’s operations all deliver their gold to Rand Refinery Proprietary Limited (Rand Refinery), which refines the
gold to saleable purity levels and then sells the gold, on behalf of the South African operations, on the bullion market. The gold is
usually sold by Rand Refinery on the same day as it is delivered and settlement is made within two days.

F-66

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

25. FINANCIAL INSTRUMENTS (continued)

CREDIT RISK (continued)

The following represents the maximum exposure to credit risk for all financial assets at June 30:

Carrying

value

2014

2013

Restated

R'000

Financial assets

Listed investments (refer note 10)

34,097

34,071

Unlisted investments (refer note 10)

171

93,484

Loans to black empowerment entities (refer note 10)

2,592

2,592

Investments in environmental rehabilitation trust funds (refer note 10)

82,848

86,356

Trade and other receivables (refer note 14)

75,826

65,221

Cash and cash equivalents

208,932

376,651

404,466

658,375

The following represents the maximum exposure to credit risk for trade and other receivables at June 30:

Carrying

value

2014

2013

Restated

R'000

Trade receivables (gold) (refer note 14)

25,630

30,415

Receivables from related parties (refer note 14)

2,992

177

Other receivables, including disposal of property debtors
(refer note 14)

47,204

34,629

75,826

65,221

The ageing of trade and other receivables at June 30:

Gross

Impair-

Gross

Impair-

value

ment

value

ment

2014

2013

Restated

2013

Restated

R'000

Not past due

72,693

(31)

62,654

(67)

Past due 0-30 days

2,017

(128)

652

(57)

Past due 31-120 days

770

(522)

1,302

(1,117)

Past due more than 120 days

7,327

(6,300)

6,973

(5,119)

82,807

(6,891)

71,581

(6,360)

Impairments were raised due to the uncertainty around the recoverability and timing of the cash flows.

Movement in the allowance for impairment in respect of trade and other receivables during the year was as follows:

Impairment Impairment

2014

2013

Restated

R'000

Balance at July 1

(6,360)

(7,820)

Impairment (recognized)/reversed

(621)

1,460

Balance at June 30

(6,981)

(6,360)

The group has no significant concentration of credit risk.

F-67

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

25. FINANCIAL INSTRUMENTS (continued)

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.

Unless otherwise stated, the following are the contractual maturities of financial liabilities, including estimated interest payments
and excluding the impact of netting agreements:

Carrying

Contractual

months

amount

cash flows

or less

6 - 12 months

2 - 5 years

R’000

June 30, 2014

Unsecured

Domestic Medium Term Note
Programme

148,695

(156,863)

(75,358)

(4,000)

(77,505)

Trade and other payables

182,136

(182,136)

330,831

(338,999)

(257,494)

(4,000)

(77,505)

June 30, 2013 Restated

Unsecured

Domestic Medium Term Note
Programme

167,626

(188,841)

(28,142)

(160,699)

Trade and other payables

190,266

(190,266)

357,892

(379,107)

(218,408)

(160,699)

MARKET RISK

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the
group's income or the value of its holding of financial instruments. The objective of market risk management is to manage and
control market risk exposures within acceptable parameters, while optimizing returns.

Commodity price sensitivity

The profitability of the group's operations, and the cash flows generated by those operations, are affected by changes in the
market price of gold which is predominantly sold in US Dollars. DRDGOLD does not enter into forward sales, derivatives or
other hedging arrangements to establish a price in advance for the sale of future gold production.

F-68

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

25. FINANCIAL INSTRUMENTS (continued)

MARKET RISK (continued)

Interest rate risk

Fluctuations in interest rates impact on the value of short-term cash investments and financing activities, giving rise to interest
rate risks. 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 minimizing risks. Funding deficits for the group's mining operations have been financed through external
borrowings. 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.

The following represents the interest rate risk profile for the group's interest-bearing financial instruments:

Carrying

value

2014

2013

Restated

R’000

Variable interest rate instruments
Financial assets

291,780

463,007

Financial liabilities

(148,695)

(167,626)

143,085

295,381

Cash flow sensitivity analysis for variable rate instruments:

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 foreign currency rates, remain constant.
The analysis is performed on the same basis for 2013.

2014

2013 Restated

Equity and profit or (loss)

100 bp

increase

decrease

increase

decrease

June 30

R’000

Variable interest rate instruments

1,431

(1,431)

2,954

(2,954)

Cashflow sensitivity

F-69

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

25. FINANCIAL INSTRUMENTS (continued)

MARKET RISK (continued)

Foreign currency risk

The group’s reporting currency is the South African Rand. Although gold is sold in US Dollars, the company is obliged to convert
this into South African Rand. The company is thus exposed to fluctuations in the US Dollar/South African Rand exchange rate.
The company conducted its operations in South Africa during the current year. Foreign exchange fluctuations affect the cash flow
that it will realise from its operations as gold is sold in US Dollars, while production costs are incurred primarily in South African
rands. The company’s results are positively affected when the US Dollar strengthens against the Rand and adversely affected
when the US Dollar weakens against the Rand. The group does not hedge against foreign currency fluctuations and considers the
risk to be low due to foreign currency normally being disposed of on the same day. The group is also exposed to certain by-
product commodity price risk. The company’s cash and cash equivalent balances are held in South African rands; holdings
denominated in other currencies are relatively insignificant.

The following represents the exposure to foreign currency risks:

2014

2013

Restated

June 30

USD’000

Trade and other receivables

2,423

3,082

Net statement of financial position exposure

2,423

3,082

The following significant exchange rates applied during the year:

Spot rate at year end

Average rate

June 30

2014

2013

2014

2013

1 US Dollar

10.5784

9.8675

10.3706

8.8328

Sensitivity analysis

A 10 % strengthening of the Rand against the currencies mentioned at June 30, would have increased/(decreased) equity and
profit/(loss) by the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain
constant. The analysis is performed on the same basis for 2013.

Impact

2014

2013

Restated

June 30

R’000

Equity

(2,563)

(3,041)

Loss

(2,563)

(3,041)

A 10% weakening of the Rand against the above currencies at June 30, would have had the equal but opposite effect on the above
currencies to the amounts shown above, on the basis that all other variables remain constant.

F-70

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

25. FINANCIAL INSTRUMENTS (continued)

MARKET RISK (continued)

Other market price risk

Equity price risk arises from available-for-sale equity securities fair value adjustments accounted for in other comprehensive
income. Investments within the portfolio are managed on an individual basis and all buy and sell decisions are approved by the
Risk Committee when significant.

The following table represents the carrying amounts and net gain/(loss), finance income and finance expense recognised in profit
or loss and / or equity as well as other comprehensive income per category of financial instruments at June 30:

Carrying

value

Equity and

profit / (loss)

Carrying

value

Equity and

profit / (loss)

2014

2013

Restated

2013

Restated

R'000

Financial assets
Available-for-sale financial assets

34,268

(98,540)

127,555

(34,221)

Loans and receivables

370,198

20,358

530,820

29,617

404,466

(78,182)

658,375

(4,604)

Financial liabilities
Financial liabilities measured at amortized cost

330,831

(14,276)

357,892

(8,438)

330,831

(14,276)

357,892

(8,438)

F-71

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

25. FINANCIAL INSTRUMENTS (continued)

FAIR VALUE OF FINANCIAL INSTRUMENTS

The following table represents the carrying amounts and fair values of the group's financial instruments at June 30: The
classification of the group’s financial instruments are discussed on page F-70.

Carrying

Fair

Carrying

Fair

value

2014

2013

Restated

2013

Restated

R’000

Financial assets measured at fair value

34,268

127,555

Listed investments (refer note 10)

34,097

34,071

Unlisted investments (refer note 10)

171

93,484

Financial assets measured at amortised cost

370,198

530,820

Loans to black empowerment entities (refer note 10)

2,592

2,592

Investments in environmental rehabilitation trust
funds (refer note 10)

82,848

86,356

Trade and other receivables (refer note 14)

75,826

65,221

Cash and cash equivalents

208,932

376,651

404,466

658,375

Financial liabilities measured at amortised cost

Loans and borrowings (refer note 20)

330,831

357,892

– non-current

75,500

143,332

– current

73,195

24,294

Trade and other payables

182,136

190,266

330,831

357,892

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date.

Financial instruments measured at fair value

The financial instruments measured at fair value are measured using the following valuation methodologies:

Listed investments
The fair value of listed investments is determined by reference to published price quotations from recognised securities exchanges
and adjusted with a discount factor for any liquidity constraints where appropriate.

Unlisted investments
The valuations are based on the net asset values of these investments and constitute the investments’ fair value as most of the
assets in these investment companies are carried at fair value. The valuations have been compared to recent transactions in the
underlying investment with external parties.

Financial instruments measured at amortised cost

The group applied the discounted cash flow valuation technique in the measurement of loans and receivables as well as financial
liabilities measured at amortised cost. No significant unobservable inputs are used in this measurement.

Loans to black empowerment entities
The fair value of these loans cannot be reliably estimated due to the unavailability of market information.

Cash and cash equivalents and investments in environmental trust funds
The carrying value of cash and cash equivalents approximates their fair value due to the short-term maturity of these deposits.
The carrying value of the environmental trust funds approximate their fair value due to these investments being cash in nature.

Trade and other receivables
The fair value approximates the carrying value due to their short-term maturities.

F-72

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

25. FINANCIAL INSTRUMENTS (continued)

FAIR VALUE OF FINANCIAL INSTRUMENTS (continued)

Loans and borrowings
The loan bears interest at the three month Johannesburg Inter-bank Acceptance Rate plus a margin ranging from 4% to 5% a year.
Fair value is calculated by reference to quoted prices for floating interest instruments.

Trade and other payables
The fair value approximates the carrying value due to their short-term maturities.

FAIR VALUE HIERARCHY

The table below analyses financial instruments carried at fair value, by valuation method. The different levels have been defined
as follows:

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2: inputs other than quoted prices included within Level 1 that are observed for the asset or liability, either directly
(i.e. as prices) or indirectly (i.e. derived from prices); and

Level 3: inputs for the asset or liability that are not based on observed market data (unobserved inputs).

Level 1

Level 2

Level 3

Total

R'000

June 30, 2014
Available-for-sale financial assets

Listed investments

30,079

4,000

34,097

Unlisted investments

171

30,079

4,000

171

34,268

June 30, 2013 Restated
Available-for-sale financial assets

Listed investments

29,571

4,500

34,071

Unlisted investments

93,484

29,571

4,500

93,484

127,555

The group applied the following unobservable inputs in the measurement of the fair value of Level 2 and Level 3 financial
instruments:

2014

2013

Level 2
Discount rate

50%

50%

Constraints on liquidity resulting from escrow agreement (refer note 10)
Level 3
Other inputs

Refer note 4

F-73

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

25. FINANCIAL INSTRUMENTS (continued)

FAIR VALUE HIERARCHY (continued)

Reconciliation of fair value measurements in Level 2 and Level 3 during the year:

2014

2013 Restated

Level 2

Level 3

Level 2

Level 3

R'000

Available-for-sale financial assets

Balance at beginning of year

4,500 93,484 151,303 20,526

Acquired during the year

26,864

Fair value adjustment

200

(53,140)

(117,232)

46,094

Impairment

(700)

(40,180)

Transfer to level 1

(29,571)

Balance at end of year

4,000

171

4,500

93,484

Impairment recognized in profit or loss

(700)

(40,180)

(101,261)

Gain/(loss) recognized in other comprehensive
income

200

(53,140)

(11,499)

46,094

Fair value adjustment recognized in other
comprehensive income

200

(53,140)

(112,760)

46,094

Impairment released to profit or loss

101,261

The gain or loss on the fair value adjustment is recognized in other comprehensive income net of deferred tax.

The available-for-sale financial assets Level 2 comprises investments in listed shares which are held in escrow (refer note 11).
The available-for-sale financial assets Level 3 comprises investments in unlisted shares for which no reasonable alternative
measure for fair value is available. Therefore no sensitivity analysis has been prepared.

26. RELATED PARTY TRANSACTIONS

2014

2013

Restated

2012

Restated

R’000

Key management personnel remuneration (excluding directors)

Short-term benefits
Salaries, bonuses and performance payments

68,939

76,405

678,114

Long service awards
Share-based payment expense

3,341

4,515

4,133

Post-retirement medical benefits

261

282

231

72,541

81,202

82,478

Directors' remuneration

Short-term benefits
Salaries, bonuses and performance payments

14,736

16,627

16,637

Long service awards
Share option scheme gains

308

4,937

Post-retirement medical benefits

15,044

21,564

16,637

The group has related party relationships with its subsidiaries, equity accounted investments and with its directors and key
management personnel. Key management personnel are those persons having authority and responsibility for planning, directing
and controlling the activities of the company, directly or indirectly, including any director (whether executive or otherwise) of the
company. During FY2014, nil (2013: 62,614 and 2012: 3,584,627) treasury shares were used to settle share options exercised by
key management personnel.

Post-retirement medical benefits and long-term employee incentive scheme balances for key management personnel as at June 30,
2014 amounts to R6.7 million (2013: R6.3 million and 2012: R6.0 million) and R2.6 million (2013: R2.3 million and 2012: Rnil),
respectively.

F-74

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

26. RELATED PARTY TRANSACTIONS (continued)

Prior to the awarding of a contract to a related party for the supply of goods and services the group procurement manager reviews
both the pricing, quality and the reliability of that party. The contract terms are compared to similar suppliers of goods and
services to ensure that the contract is on market related terms.

The company’s executive directors review the terms and conditions of all loans to ensure that the terms of the loans are similar to
those offered by financial institutions.

TRANSACTIONS WITH SUBSIDIARIES AND EQUITY ACCOUNTED INVESTMENTS

Balances outstanding at June 30, 2014
• Subsidiaries (refer note 11)
• Equity accounted investments including associates and joint ventures (refer note 12).

Transactions during the year:
During FY2014, DRDGOLD earned:
• management fees from Ergo Mining Operations Proprietary Limited (EMO) amounting to R21.9 million (2013: R25.1 million

and 2012: R21.6 million) and from Blyvoor amounting to Rnil (2013: Rnil and 2012: R15.2 million);

• interest from EMO amounting to R30.0 million (2013: R23.0 million and 2012: R26.6million), from Ergo Mining Proprietary

Limited amounting to R28.5 million (2013: R32.2 million and 2012: Rnil) and from Blyvoor amounting to Rnil (2013: Rnil and
2012: R2.6 million), respectively.

During FY2014, EMO disposed of 50 000 (2013: nil, 2012: nil) ordinary shares in the company (held as treasury shares for
consolidation purposes) to D J Pretorius at market value. As at June 30, 2014, EMO held 6,155,559 (2013: 6,205,559 and 2012:
6,268,173) treasury shares. During the year ended June 30, 2014, EMO acquired nil (2013: nil and 2012: 9,852,800) ordinary
shares (held as treasury shares for consolidation purposes) in the company.

TRANSACTIONS WITH OTHER ENTITIES IN WHICH AN OWNERSHIP INTEREST IS HELD

Guardrisk Insurance Company Limited (Guard Risk)
During FY2014 Ergo paid insurance premiums to the Guardrisk Cell Captive amounting to Rnil (2013: R21.0 million and 2012:
R41.8 million by ERPM and R21.0 million by Ergo).
Guardrisk issued environmental guarantees to the DMR amounting to R305.7 million (2013: R305.7 million, 2012: R305.7
million) relating to the environmental liabilities (note 17). These guarantees are funded by the assets in Guardrisk Insurance
Company Limited (Cell Captive) (refer note 10).

Rand Refinery Proprietary Limited (Rand Refinery)
The group has entered into an agreement with Rand Refinery, for the refining and sale of all of its gold produced in South Africa.
Under the agreement, Rand Refinery performs the final refining of the group’s gold and casts it into troy ounce bars. Rand
Refinery then sells the gold on the same day as delivery, for the London afternoon fixed price on the day the gold is sold. In
exchange for this service, the group pays Rand Refinery a variable refining fee plus fixed marketing, loan and administration fees.

Mr Gwebu, executive: legal, compliance and company secretary of DRDGOLD, was a director of Rand Refinery and a member
of its Remuneration Committee and chairman of the Social and Ethics Committee until 3 September 2014 when he resigned as
director. Mr Charles Symons was nominated to replace him as director of Rand Refinery with effect from 3 September 2014. Mr
Mark Burrell who is the financial director of Ergo is an alternate director of Rand Refinery and a member of Rand Refinery’s
Audit Committee.
• The group currently owns shares in Rand Refinery (which is jointly owned by South African mining companies) (refer note 10)
• Trade receivables to the amount of R25.6 million (2013: R30.4 million) relate to metals sold
• The group received a dividend of Rnil (2013: R6.8 million, 2012 R nil) from Rand Refinery.

CONSULTANCY AGREEMENT
On June 23, 2008, EMO approved a consultancy agreement with Khumo Gold, which owns 20% of EMO and Blyvoor. The
agreement provides for a monthly retainer of R0.3 million (2013: R0.2 million, 2012: R0.2 million).

SALE OF SHARES
The non-controlling shareholders entered into an agreement with DRDGOLD for the sale of their shares in EMO (refer note
16.2).

F-75

NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended June 30, 2014

27. CAPITAL MANAGEMENT

The primary objective of the board of directors (the board) in managing the group's capital is to ensure that there is sufficient
capital available to support the funding requirements of the group, including capital expenditure, in a way that optimizes the cost
of capital, maximizes shareholders' returns, and ensures that the group remains in a sound financial position. There were no
changes to the group's overall capital management approach during the current year. The group manages and makes adjustments
to the capital structure as opportunities arise in the market place, as and when borrowings mature or as and when funding is
required. This may take the form of raising equity, market or bank debt or hybrids thereof.

The board monitors the return on capital, which the group defines as net operating income divided by total shareholders' equity,
excluding non-redeemable preference shares and non-controlling interest from continuing operations, and seeks to maintain a
balance between the higher returns that might be possible with higher levels of borrowings and the advantages and security
afforded by a sound capital position. The board decides the level of dividends to ordinary shareholders.

The group’s net debt to equity ratio as at June 30, was as follows:

2014

2013 Restated

R’000

Total liabilities

959,535

1,025,328

Less: Cash and cash equivalents

(208,932)

(376,651)

Net liabilities

750,603

648,677

Total equity

1,481,211

1,643,672

Net debt to equity ratio at June 30

0.51

0.39

28. SUBSEQUENT EVENTS

There were no significant subsequent events between the year-end reporting date of June 30, 2014 and the date of issue of these
financial statements, except as outlined below:

On July 25, 2014, DRDGOLD announced that its subsidiaries Ergo Mining Operations Proprietary Limited (EMO) and East Rand
Proprietary Mines Limited (ERPM) collectively had entered into an agreement to dispose of certain underground mining and
prospecting rights held by ERPM, and certain other assets on the related mining areas, for an agreed consideration of R220
million. The carrying values of these assets and their related liabilities as at June 30, 2014 are outlined in note 15.

This agreement is subject to a number of suspensive conditions including regulatory consent and permission which had not been
fulfilled at the date of this report.

101

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

(7)

Articles of Association of DRDGOLD Limited, as amended on November 8, 2002.

1.3

(1)

Excerpts of relevant provisions of the South African Companies Act.

1.4

(2)

Durban Roodepoort Deep (1996) Share Option Scheme as amended.

1.5

(13)

Memorandum of Incorporation, as amended on November 30, 2012.

2.1

(1)

Excerpts of relevant provisions of the Johannesburg Stock Exchange Listings Requirements.

2.2

(5)

Indenture between DRDGOLD Limited, as Issuer, and The Bank of New York Mellon, as Trustee, dated November
12, 2002.

4.1

(3)

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

(4)

Form of Non-Executive Employment Agreement.

4.3

(4)

Form of Executive Employment Agreement.

4.4

(5)

Agreement between DRDGOLD Limited and Rand Refinery Limited, dated October 12, 2001.

4.5

(6)

Term Sheet concluded between DRDGOLD Limited and Khumo Bathong Holdings Proprietary Limited (KBH), dated
July 6, 2005.

4.6

(6)

Option Agreement entered into by and between DRDGOLD Limited and M5 Developments Proprietary Limited,
dated July 21, 2005.

4.7

(7)

Subscription Agreement between DRDGOLD Limited and DRDGOLD South African Operations Proprietary
Limited, dated November 9, 2005.

4.8

(7)

Share Sale Agreement between Crown Consolidated Gold Recoveries Limited and DRDGOLD South African
Operations Proprietary Limited, dated November 14, 2005.

4.9

(7)

Subscription Agreement between DRDGOLD South African Operations Proprietary Limited and Khumo Gold SPV
Proprietary Limited, dated November 18, 2005.

4.10

(7)

Subscription Agreement between DRDGOLD Limited and Khumo Gold SPV Proprietary Limited, dated
November 18, 2005.

4.11

(7)

Cession Agreement between DRDGOLD Limited and Khumo Gold SPV Proprietary Limited and Khumo Bathong
Holdings Proprietary Limited, dated November 18, 2005.

4.12

(7)

Option Agreement between DRDGOLD Limited and Khumo Gold SPV Proprietary Limited and DRDGOLD South
African Operations Proprietary Limited, dated November 18, 2005.

4.13

(7)

Offer of Class A Preference Share between Khumo Gold SPV Proprietary Limited and East Rand Proprietary Mines
Limited, dated November 18, 2005.

4.14

(7)

Offer of Class A Preference Share between Khumo Gold SPV Proprietary Limited and Blyvooruitzicht Gold
Mining Company Limited, dated November 18, 2005.

4.15

(7)

Offer of Class A Preference Share between Khumo Gold SPV Proprietary Limited and Crown Gold Recoveries
Proprietary Limited, dated November 18, 2005.

4.16

(7)

Shareholders’ Agreement between DRDGOLD Limited and Khumo Gold SPV Proprietary Limited and
DRDGOLD South African Operations Proprietary Limited, dated November 24, 2005.

4.17

(8)

Option Exercise Agreement between DRDGOLD Limited, Khumo Gold SPV Proprietary Limited and the Trustees
for the time being of the DRDSA Empowerment Trust dated October 10, 2006.

4.18

(8)

Class B Preference Share Subscription Agreement between DRDGOLD Limited and Khumo Gold SPV Proprietary
Limited dated October 24, 2006.

4.19

(8)

Three Class B Preference Share Subscription Agreements between Khumo Gold SPV Proprietary Limited and
Blyvooruitzicht Gold Mining Company Limited, Crown Gold Recoveries Proprietary Limited and East Rand
Proprietary Mines Limited, dated October 24, 2006.

4.20

(8)

Three Class C Preference Share Subscription Agreements between the Trustees for the time being of the DRDSA
Empowerment Trust and Blyvooruitzicht Gold Mining Company Limited, Crown Gold Recoveries Proprietary
Limited and East Rand Proprietary Mines Limited, dated October 24, 2006.

4.21

(9)

Third Addendum to Memorandum of Agreement between AngloGold Ashanti Limited (“AGA”), Ergo Mining
Proprietary Limited (formerly called Friedshelf 849 Proprietary Limited) (“Ergo”), DRDGOLD South African
Operations Proprietary (“DRDGOLD SA”) Mintails South Africa Proprietary Limited dated November 14, 2007.

4.22

(9)

Fifth Addendum to Memorandum of Agreement between AngloGold Ashanti Limited (“AGA”), Ergo Mining
Proprietary Limited (formerly called Friedshelf 849 Proprietary Limited (“Ergo”), DRDGOLD South African
Operations Proprietary (“DRDGOLD SA”) Mintails South Africa Proprietary Limited dated May 22, 2008.

4.23

(9)

Mining User Contract between Crown Gold Recoveries Proprietary Limited (“Crown”), East Rand Proprietary
Mines Limited (“ERPM”), Elsburg Gold Mining Joint Venture (“Elsburg JV”), Ergo Mining Proprietary Limited
(“Ergo”), Ergo Uranium Proprietary Limited (“Ergo Uranium”) and Mogale Gold Proprietary Limited (“Mogale
Gold”) dated August 15, 2008

4.24

(9)

Ergo Uranium Sale Agreement of Brakpan Plants to Ergo Mining between Ergo Uranium Proprietary Limited
(“Ergo Uranium”) and Ergo Mining Proprietary Limited (“Ergo”) dated August 15, 2008.

102

4.25

(9)

Ergo Mining Shareholders’ Agreement between Crown Gold Recoveries Proprietary Limited (“Crown”) and Ergo
Uranium Proprietary Limited (“Ergo Uranium”) dated August 15, 2008.

4.26

(9)

Elsburg Gold Mining Joint Venture (“Elsburg JV”) Agreement between East Rand Proprietary Mines Limited
(“ERPM”) and Mogale Gold Proprietary Limited (“Mogale Gold”) dated August 15, 2008.

4.27

(9)

Mogale Sale of Part Venture Interest in the Elsburg Gold Mining Joint Venture (“Elsburg JV”) between East Rand
Proprietary Mines Limited (“ERPM”) and Mogale Gold Proprietary Limited (“Mogale Gold”) dated September 29,
2008.

4.28

(10)

Heads of Agreement entered into by Mintails Limited, Mogale Gold Proprietary Limited (“Mogale Gold”), Ergo
Mining Proprietary Limited (“Ergo Joint Venture”), DRDGOLD Limited (“DRDGOLD”) and East Rand
Proprietary Mines Limited (“ERPM”), dated December 8, 2008.

4.29

(10)

Loan Facility entered into by Mintails South Africa Proprietary Limited (“Borrower”), DRDGOLD Limited
(“Lender”), Mintails Limited (“Borrower’s Guarantor”), Mogale Gold Proprietary Limited (Mogale Gold”) Ergo
Uranium Proprietary Limited (“Ergo Uranium”) dated December 8, 2008.

4.30

(10)

Subscription and shareholders’ Agreement entered into by Mintails SA Proprietary Limited (“Mintails SA”),
Witfontein Mining Proprietary Limited (“Witfontein”) and Argonaut Financial Services Proprietary Limited
(“Argonaut”) dated December 9, 2008.

4.31

(10)

4.32

(11)

4.33

(11)

4.34

(11)

Facility Agreement between Investec Bank limited (“the Lender”) and DRDGOLD Limited (“the Borrower”) dated
March 31, 2009.
Final Heads of Agreement between Chizim Investments (Pvt) Limited (“Chizim”) and DRDGOLD Limited
(“DRDGOLD”) dated December 9, 2009.
Memorandum of Agreement between Ergo Uranium Proprietary Limited (“Ergo Uranium”) and East Rand
Proprietary Mines Limited (“ERPM”) dated January 21, 2010.
Heads of Agreement between East Rand Proprietary Mines Limited (“ERPM”) and Aurora Empowerment System
Proprietary Limited (“Aurora”) dated January 22, 2010.

4.35

(11)

Domestic Medium Term Note Programme (“Programme”) entered into by DRDGOLD South African Operations
Proprietary Limited (“Issuer”) and DRDGOLD Limited (“guarantor’) dated September 30 2010.

4.36

(12)

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.

4.37

(12)

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.

4.38

(12)

Sale of Interest Agreement between DRDGOLD Limited (“DRDGOLD”) and Ergo Mining Proprietary Limited
(“Ergo”) dated June 29, 2012.

4.39

(13)

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.

4.40

(14)

4.41

(14)

Share Sale and Subscription Agreement between DRDGOLD Limited ("DRDGOLD") and DRDSA Empowerment
Trust (the Trust) dated March 17, 2014.

Share Sale and Subscription Agreement between DRDGOLD Limited ("DRDGOLD") and Khumo Gold SPV
Proprietary Limited ("Khumo") dated March 17, 2014.

8.1

(14)

List

Subsidiaries.

11.1

(13)

Code of Ethics, as amended February 9, 2012.

12.1

(14)

Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

12.2

(14)

Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

13.1

(14)

Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

13.2

(14)

Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

___________

(1)

Incorporated by reference to our Registration Statement (File No. 0-28800) on Form 20-F.

(2)

Incorporated by reference to our Annual Report on Form 20-F for the fiscal year ended June 30, 1997.

(3)

Incorporated by reference to Amendment No. 1 to our Registration Statement (File No.

333-140850

) on Form F-6.

(4)

Incorporated by reference to our Annual Report on Form 20-F for the fiscal year ended June 30, 2000.

(5)

Incorporated by reference to our Annual Report on Form 20-F for the fiscal year ended June 30, 2002.

(6)

Incorporated by reference to our Annual Report on Form 20-F for the fiscal year ended June 30, 2005.

(7)

Incorporated by reference to our Annual Report on Form 20-F for the fiscal year ended June 30, 2006.

(8)

Incorporated by reference to our Annual Report on Form 20-F for the fiscal year ended June 30, 2007.

(9)

Incorporated by reference to our Annual Report on Form 20-F for the fiscal year ended June 30, 2008.

(10)

Incorporated by reference to our Annual Report on Form 20-F for the fiscal year ended June 30, 2009.

(11)

Incorporated by reference to our Annual Report on Form 20-F for the fiscal year ended June 30, 2010.

(12)

Incorporated by reference to our Annual Report on Form 20-F for the fiscal year ended June 30, 2012.

(13)

Incorporated by reference to our Annual Report on Form 20-F for the fiscal year ended June 30, 2013.

(14)

Filed herewith.

103

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.

LDRDGOLD IMITED

By:

/s/

D.J.

Pretorius

D.J. Pretorius
Chief Executive Officer

By:

/s/ A.T. Meyer

A.T. Meyer
Acting Chief Financial Officer

Date: October 30, 2014

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