By Geoff Percival
Irish mining company Kenmare Resources has announced its intention to pay a maiden dividend to shareholders before the end of next year. The company, which owns the Moma titanium mine in Mozambique, said it plans an initial modest payout to shareholders in the second half of next year and that dividend value will be a minimum of 20% of post-tax profit.
“In light of the capital required for development projects, the company expects to pay modest dividends during the next two years, starting with an interim dividend based on first-half 2019 results, payable in the second half of 2019. Following completion of these development projects, the company expects to be in a position to make higher capital returns from 2021,” Kenmare said.
Despite the announcement, Kenmare’s share price fell nearly 1.7% yesterday. The company also said it is targeting production levels of 1.2 million tonnes of ilmenite, and associated co-products, per year, from the Moma mine, by 2021.
The company is targeting production levels of 900,000-to-one million tonnes for this year. “Production of ilmenite remains constrained by mining conditions, but these are expected to pick up in the fourth quarter and markets also have a stronger tone going into the final quarter,” said Davy resources analyst Job Langbroek.
Kenmare’s managing director Michael Carvill said: “We believe that industry fundamentals are supportive of higher prices, and while global growth concerns and normal seasonal weakness have driven some buying caution, this appears to be lifting.”