Kenmare shareholders back capital reduction plans
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.