Perseus to unveil dividend policy in August as secures “line of sight” over reliable cash flow

Jeff Quartermaine, MD and CEO

WEST African gold miner Perseus Mining will unveil a dividend policy when it presents its 2021 year-end numbers in August, said MD and CEO Jeff Quartermaine.

“Without speaking on behalf of the board, it’s safe to say that will happen,” said Quartermaine when asked about the likelihood of the company paying a return following a four year period of intense investment in three mines.

“The opportunity to pay a dividend in our minds is from the period onwards when we can see a clear line of sight to reliable cash flow. There is little reason why we wouldn’t announce a dividend policy when we announce the year-end results in August,” he said.

Perseus today announced record quarterly gold production of 107,788 ounces for the three months ended June, 16% higher than production in March and 50% higher than production in December. This took production for Perseus’ 2021 financial year to 328,632 oz.

Given the trajectory of its newly commissioned Youré project in Côte d’Ivoire, the company was on course for production of between 225,000 and 255,000 oz by the half-year point in December and for 500,000 oz annually in the longer term.

Notional cash flow – which includes cash held in its debtor’s book – was 51% higher than in the March quarter and totalled $62.1m. The company reported net cash of $56.1m at the quarter-end, $50.3m more than at the close of the March quarter.

“The timing of our production growth has been very fortuitous,” said Quartermaine referring to the robust state of the gold market.

Despite this, Perseus would continue to hedge about a fifth of total gold production for the next three years. This was held at an average realised price of $1,595/oz, $43/oz more than in the previous quarter as the company delivered into the hedge book and replaced those ounces with higher-priced positions.

Asked about merger and acquisition activity, Quartermaine said the group would continue to seek opportunities, but he remarked that brownfields growth was the more likely option. Reserve extension at the firm’s Edikan mine in Ghana and Youré were expected, he said.

Shares in the company are about 15% higher year-to-date, a performance Quartermaine said was recognition by the market of the company’s advances relative to peers.