eBusiness Weekly
Enacy Mapakame
Resources group and parent company of Blanket Mine — Caledonia Mining Corporation Plc — has increased quarterly dividend by 13 percent to US8,5 cents for the Q2 2020 period following a strong financial performance.
This, represents a cumulative dividend increase of 24 percent since October 2019.
According to Caledonia, the firm has demonstrated resilience despite the Covid-19 pandemic with production levels still within the range of 2020 guidance of 53 000 ounces to 56 000 ounces.
This is in addition to higher global prices of gold.
“We are pleased to announce a 13 percent increase in the dividend which reflects our continuing confidence in the outlook for our business.
“As we reported in our Q1 2020 results, our financial performance has been strong due to increased production and a higher gold price which has continued into Q2 2020.
“As we approach the end of
the five-year investment programme at Blanket Mine, we anticipate the rate of capital expenditure will begin to reduce towards the end of 2020,
which gives us greater flexibility to consider deploying some of our
cash reserves on an increased dividend,” said chief executive officer Steve
Curtis.
Meanwhile, the resources group anticipates the Central Shaft to be completed in Q4 2020.
This is expected to significantly increase production as the group targets 75 000 ounces of gold next year before further increasing to 80 000 ounces in 2022.
Said Curtis: “We expect the Central Shaft equipping to be completed in the fourth quarter of 2020; thereafter we look forward to the commissioning of the Shaft and further increases in operating cashflow as production is expected to increase by over 30 percent over the coming 24 months to approximately 75 000 ounces in 2021 and to the target rate of 80 000 ounces of gold per annum from 2022 as capital expenditure falls further and we begin to realise the operational efficiencies arising from the new shaft.
“The board will review Caledonia’s future dividend distributions as appropriate while considering the balance between delivering returns to shareholders, pursuing the significant growth opportunities within Zimbabwe and maintaining a prudent approach to financial management.”
Consistent quarterly dividend policy is one of Caledonia’s strategy to maximise shareholder value, which the group adopted in 2014.
