An­glo sur­prises mar­ket with div­i­dend

The Star Early Edition - - BUSINESS - Di­neo Faku

IT WAS A mixed bag of re­sults for JSE-listed global di­ver­si­fied min­ing house An­glo Amer­i­can which sur­prised the mar­ket with a div­i­dend yes­ter­day, while gold pro­ducer Gold Fields flagged that the stronger rand would re­sult in its earn­ings de­creas­ing for the half year to June.

An­glo, whose sub­sidiaries in­clude An­glo Amer­i­can Plat­inum and Kumba Iron Ore, said yes­ter­day that it had re­sumed div­i­dend pay­ment six months ear­lier than ex­pected and es­tab­lished a div­i­dend pol­icy of pay­ing out 40 per­cent of un­der­ly­ing earn­ings.

Mark Cu­ti­fani said: “We have nearly halved our net debt to $6.2 bil­lion over the past year to take us well be­low our year-end tar­get of $7bn.“Our ma­te­ri­ally im­proved bal­ance sheet strength, with gear­ing at 19 per­cent and net debt to an­nu­alised Ebitda of 0.8 per­cent, has sup­ported the de­ci­sion to re­sume div­i­dend pay­ments six months early, es­tab­lish­ing a pay-out pol­icy at a tar­geted level of 40 per­cent of un­der­ly­ing earn­ings,” he said.

The div­i­dend pay­ment was 48 cents a share for the first half of the year.

Cu­ti­fani said An­glo would con­tinue to fo­cus on im­prov­ing op­er­a­tional per­for­mance and costs as well as main­tain­ing strict cap­i­tal al­lo­ca­tion dis­ci­pline.

Growth op­tions

“We are now in a po­si­tion to con­sider value ac­cre­tive growth op­tions and cap­i­tal re­turns from within our sub­stan­tial un­de­vel­oped min­eral en­dow­ment.”

Due to the weak com­mod­ity price en­vi­ron­ment An­glo had a ma­jor shake-up of its min­ing port­fo­lio and moved to re­duce its min­ing as­sets to 37 at the end of June 2017 from 68 as­sets in 2014. An­glo also placed poor per­form­ing as­sets on care and main­te­nance while it closed others.

In terms of the Min­ing Char­ter III, An­glo sup­ported le­gal ac­tion by the Cham­ber of Mines.

“An­glo Amer­i­can is com­mit­ted to meet­ing South Africa’s trans­for­ma­tion ob­jec­tives and has been a long­stand­ing and ma­jor con­trib­u­tor to the coun­try’s trans­for­ma­tion, pre-dat­ing such reg­u­la­tory tar­gets.

Cu­ti­fani also said An­glo Amer­i­can wel­comed the de­ci­sion by the ANC at its pol­icy con­fer­ence that fur­ther dis­cus­sion on the char­ter was re­quired with the min­ing in­dus­try in or­der to en­sure that in­vest­ment and em­ploy­ment lev­els were not neg­a­tively af­fected.

“An­glo Amer­i­can awaits clar­ity on how this dis­cus­sion process will un­fold and will also con­tinue to en­gage through the Cham­ber of Mines,” he said.

An­glo’s share price gained 3.13 per­cent to close at R37.40 on the JSE, while Gold Fields’ share price was 0.28 per­cent up at R50.44.

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.