DRDGold, South Africa's fourth-largest gold producer, on Tuesday announced that second-quarter earnings climbed 66 percent as it continued to cash in on the higher gold price.

Total gold production was 63 659oz compared with 63 562oz in the previous quarter.

The company, which plans to exit underground mining, aims to increase its production by as much as 20 percent through the construction of a R250 million milling circuit at its Ergo's Brakpan plant.

DRDGold CEO Niël Pretorius said: “Over the next few months, we intend to fully bed down the Crown/Ergo integration, and expect to leverage the virtually unassailable competitive advantage this gives us to grow our 11Moz surface resource.”

DRDGold on Monday concluded a binding agreement to sell its 74 percent stake in the Blyvoor gold mine to another junior gold producer, Village Main Reef, for about R192 million in cash and shares.

The transaction, which was announced in November, will help DRDGold exit underground mining and concentrate solely on processing surface material.

Blyvoor produced 29676oz in the second quarter and while this figure will be cut from DRDGold's future production once the Village deal is sealed, the company expects these ounces to be replaced by further expansion of its Ergo operations.

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