Mining boss plays down economic uncertainty impact

THE head of Mozambique-focused Kenmare Resources has played down the potential impact of global economic uncertainty on the company.

Co Down man Michael Carvill said: “A trade war drops all boats. There is no way anybody can be insulated completely, but mining is a depletive industry — we are replacing supply rather than relying on new homes for our products.”

The comments from Mr Carvill, who is from Warrenpoint, came after the group announced its first dividend of $0.266 per share, despite a 20% decrease in profit before tax to $28.8m (£23.7m) in the six months to June 30.

This was on the back of a 12% decline in revenue to $122.7m (£101m) in the first half of the year. The Irish group mined record quantities of ore during the period.

However, the overall grade of the ore mined was lower, leading to an 8% decrease in production to 633,400 tonnes.

In addition, bad weather conditions impacted the shipment of finished products, according to interim results from the group.

Kenmare expects strong shipping volumes in the second half of the year which, combined with what it said were “positive pricing dynamics”, are expected to boost revenues and profitability.

Despite commentary describing the update as “a very solid performance across the board”, shares in Kenmare were down as much as 5.5% in afternoon trading yesterday.

Meanwhile, mining giant BHP handed shareholders a record dividend after boosting profits, but warned that trade tensions and the rise of nationalism could threaten returns in the sector.

The world’s biggest mining firm declared the bumper dividend after it posted its largest annual profit for five years, coming on the back of strong commodity prices.

However, shares dipped in early trading as the firm narrowly missed profit and dividend expectations as it held back funds to deal with cost rises.

BHP reported a 2% increase in underlying profits to $9.1bn (£7.5bn) for the year to June.