Ken­mare share­hold­ers back cap­i­tal re­duc­tion plans

Irish Independent - Business Week - - FRONT PAGE -

IR­ISH min­eral ex­plorer Ken­mare Re­sources share­hold­ers voted through all mo­tions at an emer­gency gen­eral meet­ing (EGM) yes­ter­day.

Share­hold­ers had been asked to ap­prove a cap­i­tal re­duc­tion – a move re­quired in or­der for the com­pany to clear the way to re­sume div­i­dend pay­ments.

Share­hold­ers voted more than 91pc in favour of the pro­posal at the meet­ing at the Con­rad Ho­tel in Dublin.

Un­der Ir­ish law Ken­mare could not pay a share­holder div­i­dend while large losses re­mained on its bal­ance sheet.

The com­pany had been car­ry­ing ac­cu­mu­lated losses of $185m since in­cor­po­ra­tion, which needed to be ex­tin­guished to free-up cash to fund div­i­dends or share buy­backs.

The cap­i­tal re­duc­tion, which in­cludes can­cel­la­tion of some shares will also re­quire the con­sent of the High Court, which is ex­pected to be sought early in the New Year.

In Oc­to­ber Ken­mare said the com­pany in­tends to re­sume div­i­dend pay­ments based on a min­i­mum of 20pc of prof­its af­ter tax on an an­nual ba­sis, be­gin­ning with an in­terim div­i­dend for the 2019 fi­nan­cial year.

The plan is to pay “mod­est div­i­dends” dur­ing the next two years and said it ex­pects to be in a po­si­tion to make higher cap­i­tal re­turns from 2021.

Ken­mare’s main busi­ness is own­ing and op­er­at­ing the huge Moma ti­ta­nium mine in Mozam­bique. In Au­gust Ken­mare re­ported rev­enues for the first six months of the year of $140.1m (€122.6m), up 37pc on the pre­vi­ous year.

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