KENMARE Resources, the mineral sands mining firm, announced a 7,69 US cents/share final dividend for its 2020 financial year described by MD Michael Carvill as “transformative” in which the groundwork has been established for a 45% to 60% lift in production.
This was despite a disappointing year in which Covid-19 related disruptions, partly offset by higher average prices for ilmenite, contributed towards lower revenue. Profit after tax came in at $16.7m, down 63% (2019: $44.8m) for the 12-month period.
A full year 2020 dividend of 10c/share has been recommended. This is 22% higher than 2019 and is comprised of a 2.31c/share interim dividend and the final 7.69c/share final dividend, to be paid in May.
The company, which operates the Moma mine in northern Mozambique, also said it was increasing its target dividend payment from a minimum of 20% of taxed profit to 25% for the current year.
Shares in Kenmare were 4.2% higher in London taking the stock to a 123% improvement over the last 12 months.
“Global demand for ilmenite, our primary product, has remained strong and prices rose through 2020,” said Carvill in a commentary to the firm’s annual results announced today.
Said Carvill: “Ilmenite remains undersupplied due to depleting ore bodies in Africa, mine closures in Australia, and continued restrictions in India.
“Average prices for our products increased by 9% in 2020 and this momentum has accelerated in the past few months, particularly for ilmenite”.
Kenmare said earlier this month that availability of staff, including some of its senior managers, was being limited by an increase in positive Covid-19 cases – most of which were asymptomatic. It added that positive Covid-19 tests had risen with some 177 employees in isolation at that time.
Carvill said today the business was “… being managed to mitigate the impact and production has continued with only minor interruptions”.