CALEDONIA Mining, the Zimbabwean gold miner, said it had increased its quarterly dividend owing to significantly improved operating conditions in the southern African nation and because the 2020 outlook was “brighter”.
The company will pay a 7.5 US cents per share dividend in January up from 6.875c/share paid quarterly last year. The increased dividend equates to an annual dividend of 30c/share which compares to net cash fro operating activities in 2019 of 169c/share.
One of the conditions that improved last year was the supply of electricity with the interruptions in the first half of the year having been “… largely addressed” following conclusion of an agreement whereby Caledonia’s operating mine, Blanket, buys power imported into Zimbabwe.
“This power is cheaper than under the previous arrangements prior to the devaluation of the Zimbabwe currency and Blanket can manage the reduced incidence of power interruptions using its increased suite of diesel generators,” said Steve Curtis, CEO of Caledonia in a statement on March 16.
“We are also well-advanced in the evaluation of a solar project to provide some of Blanket’s power supply and reduce its dependence on imported power during daylight hours.”
Commenting on 2020, Curtis said the year would be “pivotal” as the company was commissioning its new central shaft. “The level of the gold price and the effects of the COVID-19 pandemic are being closely monitored and I look forward to keeping our shareholders updated on our progress,” he said.